So the new Monti goverment has been given the thumbs up by all the other parties, the Church and the Unions – so we’re stuffed. Monti must have spun a line to get them all on board and now it will all unravel and nothing will get done. The choice of ‘technical’ ministers is bothersome too – the acting director of one the huge failing Italian banks, isnt someone who I would run to to help growth. But let’s wait and see.
In the meantime here’s a typical Italian story.
In Puglia the’ve built a lovely holiday resort for 50 million euros. Theres a hotel, amphitheatre, disco, swimming pool health centre, all of which ‘face the sea inside the National Park’. Aye, and theres the rub. To allow this excrescence people who worked for the region and comunes changed planning laws, among them the now exmayor of porto Cesareo, another 8 officials from the comune and 3 people from the Region Environement and Urban departments. The Guardia di Finanze, ever vigilant, has discovered that the village was built by illegal zoning of the land, in 2002. On top of all this there is tax evasion on the mixing of vast amounts of cement for over 6.5 million euros. Now its laudable that teh Guardia stop these things- but couldnt they have intervened 9 years ago when the process begun, instead of waiting till the complex was built and open to the public? Now we know that there will great wailing and gnashing of teeth, a pathetic fine and nothing will change. People will talk of sending in the bulldozers but it will never happen, (and even if it did, the entire zone would be left as a building site for the next 25 years), and all will carry on as normal. And another piece of the lovely Italy has gone forever.
Tax evasion in Italy is reckoned to be about 18% of GDP – The problem is that when the yellow flames come and get you, and all is said and done – the fines are risible and it is not a penal but a civil crime. All of which means that it is actually worth your while to evade tax. Now, should some new PM have the wizard idea of making tax evaders pay ALL the tax evaded plus the costs of recovery – that might help get the total down. Instead you can usually bargain for a 5 -15 % and lets all forget it type of deal. Not exactly the deterrent needed – but then the political class are possibly the worst tax payers in the country so they are hardly likely to give themselves a hard time.
Over to you Mr Monti…