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Flat tax 'unrealistic' in Italy says BoI

Flat tax 'unrealistic' in Italy says BoI

Due to welfare, public finance constraints says Ricotti

ROME, 18 May 2023, 19:14

Redazione ANSA

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The government's new flat tax is "unrealistic" in Italy, the Bank of Italy said Thursday.
    The flat tax, contained in the government's tax enabling bill, "could turn out to be an unrealistic model" for a country, like Italy, "with an extensive welfare system, especially in light of public finance constraints," warned the head of the Bank of Italy's Tax Assistance and Advisory Service Giacomo Ricotti in a hearing at the Lower House finance committee.
    For Ricotti, "it is not clear either which tax incentives will be the subject of rationalisation or the amount of resources that will be recovered".
    Premier Giorgia Meloni's government is aiming to bring in a flat tax for all workers in Italy by the end of the current parliamentary term, in less than five years' time, according to its tax-reform enabling bill.
    At the moment, Italy has a 15% flat tax, but it only applies to self-employed people earning up to 85,000 euros a year at the moment.
    The reform said a step towards a flat tax for all will be the reduction of the number of income-tax bands applied to people employed by private-sector firms and the State from four to three.
    The reform also seeks to significantly cut down the number of taxes in force in Italy.
   

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