TAX NEWS - June 2010
Italy Tax: Tax Evasion
Unfortunately evasion in Italy is high and remained fairly constant over the years. As the statistical estimates of underground phenomena by their nature, such as tax evasion and the underground economy, are necessarily imprecise, we can say that in Italy the work on both the order of 26% of Gross Domestic Product (2003), and is slightly raised during the previous decade (23% in 1990).
We can also see that these percentages are comparable to those of Greece (28% in 2003) and Spain (22%), while they are vastly superior to those such as the United States (8-9%).
On most American tax efficient than some Italian weigh several factors: the overall quality of public administration uses the specific data collection system and monitoring of tax returns, the severity (and, again, efficiency) of the U.S. judicial system the value system of American citizens themselves, who are certainly not saints but they have more civic sense for us Italians.
But the question of evasion and undeclared in Italy can not be explained only with a certain ineptitude of our tax administration and judiciary, but rather a lack of political will. This is because tax evasion and the underground economy in Italy are not more or less evenly distributed over the population. More than elsewhere, in fact, are self-employed in Italy to be able to escape or evade taxes. The fight against tax evasion means then collide with powerful lobbies such as those of traders and professions. But the political disincentives to fight against tax evasion are even sharper when one considers the geographical distribution of evasion. The reality, as "politically incorrect" is that a large proportion of evasion, particularly total evasion, is south of the country, namely in the poorest regions. A survey of the Revenue estimates for the period 1998-02, the IRAP tax evaded is the order of 38% in Sicily, Campania, Puglia, Sardinia (and even 48% for Calabria), while both the order of 17% in Piedmont, Emilia Romagna, Veneto (and up to 11-12% in Lombardy), in line with France and Germany. As you take these figures with pliers, you understand how the problem of evasion is intimately tied to a problem even more vast and complex as the Southern question (and the related issue of criminal control of a significant economy of South ). Fiscal federalism could well be a partial solution, but unfortunately sees little good in the enabling act passed by Parliament last May.
But what's more, there is another reason why it is difficult to act politically sull'evasione in Italy. The tax burden on the economy as a whole is now at levels not withstand more than 40% (one at work is 44% versus 34% of EU average in 2007). Since the Italian tax system, tax evaders would be completely crushed the brake on the economy of the country. I'm really independent workers and industries to have submerged it greater flexibility in reducing hours worked and employment. I say this, of course, to argue that it is desirable to turn a blind eye sull'evasione, absolutely not, if only for reasons of basic justice and fairness (which has clearly stated yesterday Antonio dark on these columns). I say instead to explain why the problem of evasion is linked to that of public spending. The costs in terms of economic growth in a serious fight against tax evasion would be greatly reduced only when public spending was cut in order to leave enough room for a significant reduction in the tax burden. It's good then Minister Tremonti today to link the fight against tax evasion in a reduction of the "weight of public ownership", where "there is a vast area of unproductive expenditure" with a "misuse of public money." Unfortunately, the fight against tax evasion is not possible without addressing the issue head on south and attack without spending there where it hurts: pensions, for one thing, and not only those disability.
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