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MNI BRIEF: Bank Of Italy Calls Flat Tax Plan Unrealistic

(MNI) ROME

Italian government plans for a flat tax could be “unrealistic” for a country with an extensive welfare system and public finances constraints like Italy, the Bank of Italy’s Tax Analysis head Giacomo Ricotti told a parliament hearing on Thursday.

Ricotti asked for a comprehensive evaluation of the effects of a flat tax on the progressive aspect of taxation, noting that its impact would depend on the specific rate and the structure of deductions and exemptions that are still to be known.

Tax system reform should protect government revenue whilst remaining equitable, he said.

Given the constraints of Italy’s public finances, and its high taxes on work and capital, “the tax burden should be shifted away from productive factors to rents and consumption”, he added. (See MNI: Italy Seeks EUR9-11 Bln Savings Or Extra Revenue-Sources)

MNI Rome Bureau | +34-672-478-840 | santi.pinol.ext@marketnews.com
MNI Rome Bureau | +34-672-478-840 | santi.pinol.ext@marketnews.com

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