It is not enough to cancel the IRAP: this is what is needed to improve the taxation of SMEs
Useful tips for reforming the tax authorities in a pro-development sense. The speech by Marco Salustri, national councilor of Unimpresa
The Draghi government is engaged in a radical, complex and articulated reform of the tax system. The Italian tax authorities, now worn out and far from the efficiency that characterizes all the major Western countries, needs a decisive, and definitive restyling, in order to give the national economy a quick restart, starting with micro, small and medium-sized enterprises. A company has repeatedly reiterated the importance of reshaping the tax system, aiming at greater equity for all taxpayers. To this end, it offered the executive pro-tempore in-depth and motivated contributions. An important and necessary step of the reform concerns the abolition of IRAP, which would help to lighten the tax burden of SMEs. In fact, IRAP represents only an increase in costs for businesses, because it consists of a complex legislative process that is added to that of IRES . But IRAP cannot be eliminated without an organic strategy of the entire tax system.
The Irap (regional tax on productive activities) was introduced with legislative decree 446 of 15 December 1997. This tax is applied to the tax base, determined by the value of net production, deriving from the activity carried out at the regional level. Initially set up to finance local health, it is now destined for the regional budget in general. It has already undergone several changes. for both businesses and self-employed workers. It has become obsolete, as it is added to a complex system of direct rules, for which it no longer has any reason to be maintained. One of the problems, which would arise from the cancellation of this tax, concerns the extent of its tax revenue which, to date, amounts to about 25 billion euros, corresponding to about one and a half points of GDP. Therefore, it would be impossible and irrational to think of being able to change a tax, taking it individually, without evaluating the impact of the cancellation on the tax system as a whole. Its absorption could be foreseen in the IRES tax return, for companies, and Irpef, for self-employed workers, but in order to establish the amount, or the percentage points necessary to offset the revenue, a macroeconomic analysis should first be carried out. the tax impact on IRES, IRPEF and VAT revenues, in order to avoid regulatory and financial "holes" in the public budget.
Only after having simulated the total revenue of all taxes, it will be possible to think about how to proceed to reabsorb IRAP. In the Anglo-Saxon system, for example, taxes are marked by very simple and clear legislation, whose change of direction would be immediate and without particular complexity. On the contrary, the Italian tax system is characterized by thousands of articles and paragraphs, which are continuously intertwined and which, not infrequently, contradict each other. A company hopes that the Draghi government, aware of the urgency of a substantial economic recovery, which involves, first of all, SMEs, with their 40 billion in tax revenue every year, will implement an organic reform, which, finally, will simplify the legislation, making the investments necessary to compete with the most aggressive European and non-European competitors more expeditious.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/non-basta-cancellare-irap-ecco-cosa-serve-per-migliorare-il-fisco-delle-pmi/ on Tue, 21 Sep 2021 08:21:58 +0000.