The cut in personal income tax "is postponed for the moment, but we continue to reduce the tax burden". The Economy Minister said, Pier Carlo Padoan, at Porta a Porta. "The tax burden - she added - is high, it has started to fall, but it has to fall again".
“We are doing the math – Padoan said – in the area of fiscal space. The government, he explained, thinks of "support for investment, innovation and productivity, which also means higher wages". “Company-level contracts – she added – must be supported, they are a source of growth in productivity, competitiveness and workers' income”. The minister then confirmed that the executive is also thinking about "confirm super depreciation" which has worked fine so far.
Meanwhile, Prime Minister Renzi also speaks of a maneuver, assuring that "it will bring together social justice and growth". “Gossip – he writes in the enews – is zero, jobs at more than 585.000. But unfortunately that's not enough. And so in the stability law there will be new measures for competitiveness. And there will also be measures to facilitate the retirement of those who have matured many years but do not yet have the requisites envisaged by the Monti-Fornero reform: keeping social justice together with growth, this is our goal". “We have to make investments in research – she underlines – we put concessions in the last stability law, we will continue to do so in the next manoeuvre”.
Padoan also revealed that he has been persuasive towards Renzi on the deficit front. With the premier convinced to use all the available margin up to 3% and the minister determined to maintain a path of consolidation of the public budget by respecting European commitments. “I never throw the jacket at him because he often doesn't have it, but I can quote the prime minister himself. When asked if he ever changed his mind, he said I convinced him to bring the deficit down rather than up it." Let him up, he added, it would be serious "due to the reputational costs that the country would pay". This is why “the deficit will continue to fall. It is inevitable in a country with a high debt like ours”.
Renzi and Padoan are on the same wavelength when it comes to GDP. She improves, but does not satisfy. However, there are the latest Istat data on the labor market to give some support to the government's optimism: "The recovery is there even if it is weak – says Padoan -. Employment growth is higher than GDP and this is an indicator that the Jobs Act is working. This bodes well for the future, because more workers mean more potential growth”.
Resources are limited and the Government is betting strongly on the fight against tax evasion, through traditional mechanisms, but also with a new voluntary disclosure. The recovery of tax evasion, explained Padoan, will be "about 15 billion this year and will have to increase next year". With regard to the politically recurring proposal to introduce a "flat tax" in Italy, Padoan did not say he was against it a priori. “It could also work in different economic conditions, for example it was adopted in Eastern European countries because they started from very different development situations, but our system is very complex. It is an interesting but unrealistic exercise for Italy”. An exercise that you want to repeat is instead the Voluntary disclosure: "we are studying the mechanisms" and "I would settle for a little less than 4 billion".
As far as Italian banks are concerned, Padoan shows confidence in the stability of the system and optimism in the resolution of the MPS case. In Italy, he says, today "there are no banks at risk: Mps is a special case", this situation “has been certified by stress tests”. Restoring MPS will have a balancing effect on the entire credit system, "it will demonstrate once and for all that the system is sound, contrary to what some sometimes say, that there are market mechanisms within the system to strengthen the banks and it will give a positive signal to the markets and to the credit system”. On Wednesday, Padoan announces, "from what I understand", there will be the board of directors who will appoint the new managing director of Montepaschi.
