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Economy
18 February 2025

Italy Sees Record Tax Recovery Amid Legislative Setbacks

Government claims 26.3 billion euros recovered as Senate halts new tax relief measures

The Italian tax recovery agency has reported impressive new figures for 2024, claiming to have recovered 26.3 billion euros from tax evasion, which is 1.6 billion euros more than the previous year. According to Vincenzo Carbone, director of the Agenzia delle Entrate, this marks the highest recovery amount on record for the agency.

Prime Minister Giorgia Meloni heralded this development as evidence of government competence, asserting, "A new record," and attributing the success largely to the current administration's efforts. She claimed the recovery surpasses the earlier figure cited by Deputy Minister Maurizio Leo, who recently noted the importance of these figures against claims of governmental complicity with tax evasion.

Delving deep, the reported recovery amounts reveal significant details. Carbone highlighted, "Of the total recoveries, 22.8 billion euros came from actively conducted recovery actions, showing a 16 percent increase from the prior year." A lump of 12.6 billion euros emerged from direct payments following agency-issued directives, and another 4.5 billion euros resulted from promotional compliance efforts, such as encouraging voluntary payments through friendly reminder letters.

Nevertheless, not all news has been positive on the fiscal front. The Senate's Constitutional Affairs Committee recently declared the proposed rottamazione-quinquies measure inadmissible, leaving many to ponder the future of fiscal relief initiatives. This legislation could have eased tax burdens for taxpayers who have incurred tax debts since January 1, 2000, allowing payments across as many as 120 installments.

Political responses have underscored the stark divisions among parties about tax policy. Andrea Crippa, the Lega's vicesegretario, criticized the left, asserting, "Salvini is working toward fiscal peace. Meanwhile, Schlein and Conte push for the European wealth tax; one side seeks to help honest workers pay their taxes, the other appears fixated on punishing Italians for European policies."

Many were counting on the proposed rottamazione-quinquies, as it would have absorbed specific debts. These include local taxes, fines, and other liabilities. Still, debts related to the EU's traditional resources, state aid recoveries, and penalties from the Court of Auditors would have been excluded from this relief plan.

Despite this setback, taxpayers are being encouraged to explore alternative solutions, including ordinary installment payments. This route allows individuals already participating in the previous rottamazione-quater to continue payments without risking asset seizures, like foreclosures or tax liens.

Although the defeat of the rottamazione-quinquies posed immediate challenges, the Ministry of Economy and Finance's strategic framework for 2025-2027 suggests fiscal policies will evolve. This may include new forms of debt relief and heightened measures to bolster tax collection capabilities.

Discussions about future fiscal policies are anticipated to continue, with potential new relief measures on the horizon. The government's comprehensive strategy appears poised to tackle systemic issues with tax evasion and optimize the collection processes.

Insights from both sides of the political spectrum indicate the potential for transformative changes within the coming months. With varying perspectives on taxation, it remains to be seen how the government will navigate these challenges to balance tax compliance with taxpayer relief.

The road from the elimination of the rottamazione-quinquies proposal to future tax reforms is fraught with complications. Observers are hopeful about the possibilities, reminding taxpayers of the prudent alternatives at their disposal as they await clearer directives on the government's fiscal intentions.

Expectations for reform are high amid increasing discussions among political factions mobilizing their base related to tax fairness and payment strategies.