The Government is finalizing the budget maneuver which will arrive in Parliament by next week - as assured by the Minister of Regional Affairs, Francesco Boccia. Beyond the individual measures on which much has been discussed and much will be discussed (with amendments), the general structure of the law is starting to take on definite contours. What is there to expect? We talked about it with Fabrizio Galimberti, former chief economist of the Treasury Minister, Nino Andreatta, OECD economist and head of the Fiat research office, as well as a columnist for Sole 24 Ore.
Dr Galimberti, is the maneuver really "expansive" as claimed by the Government?
“The answer is not easy. Expansive or restrictive with respect to what? Let us take that crucial variable which is the balance of the structural primary budget. If this balance improves, it means that the maneuver is restrictive, because the budget absorbs more resources from the economy than it gives away. If, on the other hand, the balance worsens, the maneuver is expansionary. Well, this balance worsens by about half a point of GDP, so we are faced with an expansionary manoeuvre".
What do you think is missing?
«The maneuver lacks that intangible but essential element which is trust. The effects of a maneuver are not only assessed on the individual measures, but above all on its ability to instill confidence in operators. The markets believe in this manoeuvre, but we are not sure that the citizens believe it too. And it is their propensity to spend that decisively influences the trend of the GDP».
Brussels has expressed doubts about the balances. Given the share of coverage entrusted to the fight against tax evasion (over 7 billion, a sum deemed unrealistic by Bank of Italy and the Court of Auditors), in 2020 are we at risk of yet another encore-maneuver?
"It is legitimate to have doubts about the revenue from the anti-avoidance measures, but it must be remembered that we have not fully priced in the savings from spending on public debt interest, which is more substantial than what is currently indicated in the budget".
Could VAT have been acted differently?
«From a theoretical point of view it would have made sense to increase VAT without increasing the tax burden, while at the same time reducing direct taxes. But from a political point of view it is clear that it could not be done. So in the abstract we can say that it was a missed opportunity, but if we go from the abstract dimension to the real one of this time and of this country… I would say that it could not have been done otherwise».
