New Italian fiscal policy: the wealth meter (July 1997)
Italy’s leftist government has devised a way of continuing the class struggle. The new fiscal policy that the government is proposing is supposedly meant to reduce the number of recipients of social services who don’t have the economic need for those services. However, the measure is more a confession of the government’s ineptitude when it comes to fighting tax evasion.
Although the authorities have not indicated exactly how they plan to implement the measure, many feel that there is the risk of a Big Brother phenomenon. Italians had to wait longer than most citizens of developed countries to enjoy the benefits of automated spending facilities like ATM machines and credit cards to become commonplace in their daily lives. Now they are risking that these amenities will be used as a boomerang. Using the oppressive measures of the vestiges of communism, the new law could be used to monitor, control, and punish those who demonstrate by their spending habits to have more economic means than the government thinks they should have judging from their tax return forms.
The measure is dividing the country in half, reminiscent of the class struggle during the sixties and seventies, between workers and the self-employed. The only ones in favor of the initiative are the worker’s unions. The federations of artisans and merchants are strongly protesting against it. Even the federation of merchants whose sympathies lie with the ruling leftist coalition have spoken out against the measure defining it as a way for the government to unload its problems on the independent workers.
Sergio Bille, head of Confcommercio, called the measure Stalinist, recalling the tattletale methods used during the purges. Pierferdinando Casini, leader of the CCD party, regards the "richmeter" as more of an Inquisitional instrument rather than one reflecting modern fiscal policies. Adolfo Urso of the National Alliance party calls it a barbaric mechanism that could only have been conceived by the very worst and classist of leftists.
The justification for such a controversial initiative is that the government is in dire straits to come up with a means of filling its cash reserves. However, the Italian government would be acting wiser if it were to implement more modern measures to straighten out its finances. It needs first and foremost to downsize its own bureaucratic structure which serves more to delay rather than expedite the needs of its citizens.
As far as tax evasion is concerned, they need to prove to Italians that something useful is being done with their tax money. Many Italians have so little faith that their money will go toward the public good, that they continue to feel that they are actually doing good by not allowing their hard-earned money to go into the hands of the state.
Those who produce jobs feel that they can better benefit society by reinvesting their money in their own activities so that they can continue to provide jobs to others. This may sound like a simple pretext for not paying taxes. However, the truth is that if businesses were to abide by the letter of the law, they would tax themselves right out of business, adding themselves and their employees to the growing ranks of the unemployed. This has indeed been the fate of many small enterprises that were unable to find the loopholes that would free them from handing over 60% of their earnings in taxes!
This collective psychosis and aversion toward the paying of revenues can only be cured by the actions and deeds of the government: by implementing tax reform measures that promote rather than discourage economic activity and by demonstrating responsibility when it comes to public spending, certainly not by using Big Brotherism tactics that are causing many Italians to make comparisons with history’s most detestable examples of authoritarianism.
July 1997
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