“Consumption will wake up in February” reads the front page of a well-known Italian economic newspaper. How does one arrive at this suggestive statement? Not from an Istat data on consumption trends, as would have been logical to expect, but indirectly, through reasoning, which starts from the data released by the Ministry of Economy and Finance on tax revenues for the first quarter of 2014.
Since we read, in the all too aseptic press release published on the MEF website, that VAT revenues grew by 4,6% in the first two months of the year compared to the same period of the previous year, with a logical-deductive procedure the newspaper derives the affirmation that the recovery in consumption is underway.
How true it is that numbers can say everything and the opposite of everything, if you don't know how to interpret them! Waiting to know, at the end of the month, the real data on the consumption trend in February, which will be calculated by Istat, let's reason on the fact that between the first two months of 2013 and the first two months of 2014 the ordinary VAT rate went from 21 to 22 percent. This happened in October, in particular.
If we calculate the percentage increase of this rate increase, we see that it is 4,76 percent. With unchanged consumption, therefore, VAT revenues should have increased by 4,76%, which rounded to the first decimal place gives 4,8 percent. The data on revenue released by the MEF is also rounded to one decimal, indicating an increase of 4,6 percent.
If in the economic press we had read, on the front page, "consumption still declining in the first two months of the year", we could have criticized the lightness with which a macroeconomic conclusion is drawn on the basis only of short-term indirect data, which can be influenced by various distorting factors: in fact, these are preliminary final data, which, moreover, concern ascertained revenues and not receipts. But the criticisms would stop there.
But the pseudo-information on the recovery of consumption, obtained from that miserable 4,6% "addicted" to the increase in revenue, produces a real reversal of reality. And that's too much.
After that, if the economic newspaper had wanted to carry out a different reflection on consumption, perhaps it could have found some element on which to base it. For what the monthly revenue data is worth, as recorded by the Finance Department on elements supplied by Sogei, it can be seen that in the first two months of 2014 the increase in VAT on domestic consumption was 7,6%, against a 8,2% decrease in VAT on imports. However, the legitimacy of this indication also fades, when we see that in the month of February alone, the VAT on imports increased by 32%, after it had fallen by 24% in January!
The only reasonable conclusion is that these revenue data, as they are recorded and compared by the MEF, cannot be used correctly to draw conclusions on the trend of the underlying economic variables, especially in the very short term and with village bar interpretations.
