Italian Medium-Sized Firms Face High Taxes

by Ulrika Lomas, Tax-News.com, Brussels

02 December 2010

A study by R&S-Mediobanca has shown that Italian medium-sized companies, despite their good profitability, are let down by the high rate of taxation they suffer in comparison with similar companies in Germany and Spain.

Firstly, the study emphasizes the importance to the economy of Italian medium-sized companies, classified as those with between 50 and 499 employees and a turnover between EUR13m (USD17m) and EUR290m, that are said to provide more than 31% of Italy’s productive jobs, and to show a net value-added per employee of more than 51% (more than 55% for those with total employees between 50 and 99).

In fact, the net operating margin of medium-sized companies in Italy and Spain, at 24% and 23%, respectively, has exceeded that of equivalent German companies, at 20%.

However, it is shown that Italian companies are subsequently penalized by the tax rate they have to pay. While the taxes paid by German and Spanish companies are similar at just over 25%, Italian medium-sized companies suffered a total tax rate of 48.3%.

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