On the table of the Council of Ministers today there is not only the labor reform. Indeed, in the Monti team's agenda, the first item on the agenda is quite another: the draft enabling law for tax reform. However, it is by no means certain that approval will be reached today. The Government could limit itself to continuing the discussion, postponing the green light to a subsequent meeting of ministers.
This delegation has been talked about for weeks now, but there are still many issues to be clarified. First of all the relationship between this measure and the delegation issued by the previous government, with the signature of Giulio Tremonti at the bottom. A text still suspended in mid-air between the offices of Parliament.
From the information we have on the projects of the new Executive, the only point in common between the two powers should be the reorganization of tax breaks. On the other hand, far more important chapters envisaged by the Berluscones are skipped, such as the cancellation of theIRAP and the reduction of personal income tax rates from five to three (one rejection officially confirmed yesterday by the Deputy Minister of Economy, Vittorio Grilli).
The link between the two measures is therefore very tenuous, but Berlusconi's delegation could still survive, at least formally. The idea of not writing a new text, but of change the old one with a big amendment. According to the president of the Senate Finance Committee, Mario Baldassarri, the tax law already being examined by the Senate could also be a suitable instrument for conveying parts of the delegation.
The goal would be to reduce approval times, which are already long enough for this legislative instrument. After the approval of the enabling bill, the government will have nine months to issue one or more enabling decrees, while any corrective measures will have to arrive in the following 18 months. Each decree will then have to be examined and approved by the parliamentary commissions, to then collect the definitive go-ahead.
Let's see in the form of a diagram what are the fundamental points that should be included in the text:
- Personal income tax fund. The proceeds deriving from the fight against evasion and from the reorganization of the concessions will flow into a fund destined for possible tax relief.
- Review of cadastral income. An increase in the general levy is not envisaged (the rate will decrease as the annuity increases), however they will be revised the criteria on the basis of which to calculate the cadastral income, in particular by replacing the number of rooms with square meters as the basic unit of measurement. However, other more difficult to determine aspects will also be taken into account to establish the new rents, such as the different quality of the areas in which the buildings are located. The operation could therefore require a total of a few years of work.
- From IRES to IRI. The corporate income tax will be replaced by the new corporate income tax. Basically, the incomes of professionals and small entrepreneurs will be subject to Irpef, which is a progressive tax, ie it grows as income increases. Ires, on the other hand, had a fixed rate of 27,5%.
- Cutting benefits. It is probably the most delicate and complex question among those that the Government will have to face after the approval of the delegation. The technical report states that, "having opportunely decided to renounce linear cuts, it is necessary to selectively identify the measures that can be intervened". Some are considered "intangible", such as those provided for by our Constitution or by the Community legal system. The aim is therefore to reduce "the most obsolete tax expenditures, less consistent with the structure of the tax system, those aimed at a small number of beneficiaries, those of modest unitary amounts".
- Contentious. The use of out-of-court procedures for settling small disputes is envisaged to speed up the disputes falling within the competence of the tax commissions. Judicial conciliation could also be extended to the appeal phase and the revocation judgment.
- Carbon Tax. Incoming heavier excise duties on producers of fossil fuels to finance the development of renewable sources.
- More severe criminal penalties. Tax avoidance will not have criminal relevance, but for the evaders the penalties will be reviewed according to criteria of "predetermination and proportionality" of the conduct.
