Following the recent promises made by Silvio Berlusconi, Italy’s Premier, to cut IRAP (the regional corporate tax), which was followed by a certain amount of political back-tracking, Emma Marcegaglia, the President of Confindustria, the Italian Business Federation, has called on the government to announce that reductions to the tax will begin next January.
Marcegaglia had already begun the subsequent debate by advocating IRAP reductions in a speech earlier in October. She has now asked that the government should provide a concrete programme for such reductions.
She argued that Confindustria was aware that cuts to IRAP could not be made immediately, as the economy had not yet fully emerged from the economic crisis. However, industrialists are asking the government to provide a serious programme of gradual future reductions to IRAP - part of which, they argue, should begin next January, with another reduction in January 2011, and so on.
Confindustria, she added, continued to request corporate tax cuts in order that Italian companies could return to international competitiveness.
If Germany has decided to reduce taxes from January 1, 2010, and the Italian government does nothing, she continued, the competitive gap between the two countries would never be bridged. France, it was noted, also appears to be moving in a similar direction.
While Confindustria is aware that Italy has a worse public sector deficit than Germany, and that cuts in corporate taxes could not be made in isolation from changes to personal taxation, they believe that, at least, certainty is required in the present situation, rather than the government's continued protestations that funds are unavailable.
Consequently, she underlined that public expenditure could, and should, be reduced. There are, she argued in conclusion, many public companies which could be privatised, as well as superfluous state agencies.
.Tags: Italy | Italy
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