Because the draft tax reform doesn’t convince me. Word of Prof
The State must redistribute resources, through the tax levy, accepting that times have changed, that taxation must focus on consumption and thus overcome the territorial limits of the taxes in force. The speech by Chiara Oldani, professor of Economic Policy at the University of Tuscia and the Sapienza University of Rome
The news filtering through the press on tax "reform" is really disheartening. Reducing income tax rates (IRPEF, etc.) cannot be called a "reform"; reform means giving shape, not filing here and there, without solving the basic issue which is the loss of state revenue, of the competitiveness of the economy. The revenue will not be recovered with the 'reform' we are reading about these days and competitiveness will not benefit; the Italian tax reform is included in the list of reforms necessary to obtain the PNRR funds and not be asked for those already disbursed back. It must be taken seriously.
In the famous scene from the film We just have to cry , set in the Middle Ages, Benigni and Muti cross the border on the cart and the customs officer asks them "Who are you, what do you do, what are you bringing". Regardless of their answers, he demands payment of the 1 guilder fee.
The sack falls to the ground, Muti gets off the cart to pick it up and the customs officer repeats the same questions, to get 1 florin again.
The Italian taxman from the Middle Ages to today has not changed much, he persists in taxing only work activities, largely dependent, as did the deaf and blind customs officer in the film. Employees just have to cry, they cover a large part of the state's expenses with their taxes and have no defense.
The current taxes date back to the 1970s, years in which a taxable base, a taxable person, could be identified. The tax reform of the 1970s was revolutionary and forced the public administration to evolve. It's been 50 years.
Today a large part of economic activities are dematerialized (e.g. social networks and related earnings), are traded on blockchain (e.g. cryptocurrencies, NFTs and smart contracts ) and are above all without fiscal territoriality (e.g. Apple, Amazon and other companies of Silicon Valley do not pay taxes in any country in the world). The loss of revenue estimated by the OECD due to these phenomena exceeds 240 billion dollars a year. One cannot really think of recovering these sums on the saddle of a medieval cart.
The State must redistribute resources, through the tax levy, accepting that times have changed, that taxation must focus on consumption and thus overcome the territorial limits of the taxes in force.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/bozza-riforma-fiscale-analisi-chiara-oldani/ on Fri, 10 Mar 2023 12:30:46 +0000.