FacebookTwitterGoogle+RedditEmail

In the Republic of Yachts

by TOM GILL

The rich don’t pay taxes. Everybody knows that. Especially in Italy, where governments have maintained firmly on the side of the 1%.

So no surprises then that new levies on large cylinder cars, yachts and private jets, introduced in December by the premier Mario Monti, have been a bit of a flop.

The tasse sul lusso were designed to placate the 99% who over the past 18 months have been forced fed with a poisonous array of austerity medicine including tax hikes and cuts to pensions, welfare and public services.

In particular the taxes on luxury were a ploy by the unelected millionaire premier to head off calls for a much more comprehensive wealth tax, or patrimoniale, in a country where private wealth stands at 8.6 trillion euros, according to the Bank of Italy, or more than four times the country’s public debt mountain of around two trillion euros.

If the top 50% richest were taxed at a rate of 2%, that could raise more than 100 billion euros, plenty to fix Italy’s dire public finances at a stroke with plenty left over to slash the near 11% unemployment rate, reverse swinging cuts to public services and lift the zombie economy out of recession.)

But even if the top 1% – the 240 000 Italian families that own 13% of Italy’s wealth, or one trillion euros, according to the Bank of Italy – were taxed, as in France, at a rate of 0.5% (the lower end of a wealth tax that rises to 1.8%), that would yield a very respectable 5 billion-plus euros a year.

But premier Monti, a former European Commissioner and member of the Bilderberg plutocrats club, wasn’t about to do that to his friends in the Italian and global elite. Hence his symbolic swipe at their ostentatious life-style.

To be sure it must have been entertaining to see some of the on-the-spot tax inspections that began in March in Cortina d’Ampezzo, a fashionable ski resort where many owners of Ferraris, Maseratis and Lamborghinis declared incomes of less than 24,000 euros a year.

Or this summer, when Italian tax police turned up at quaysides unannounced, boarding yachts and checking owners’ details against their tax files. In one of their first tax raids in April in the southern port of Bari inspectors found yachts owned by people who declared almost no income. One of the most shameless cases was a 1.2 million-euro yacht whose owner had never filed a tax return.

But the tasse sul lusso haven’t delivered on expectations, according to financial daily IlSole24ore.

They were supposed to have raised 387 million euros for the taxman. Instead he’s received just a quarter of that, or 92 million euros.

The biggest tax dodgers have been owners of the yachts of over 10 metres in length. By 31 May they should have paid a total of 155 million euros. Instead they coughed up just 23 million euros. One reason was a technical loophole taylor-made for high net worth individuals and their expensive accountants.

Originally the tax on boats was to be paid by anyone docking their yacht in Italian waters. The tax would have been applied on a sliding scale, reaching around 22,000 euros a month for a superyacht over 70 metres. But in March parliament passed an amendment exempting foreign owners – among them a wave of Russian oligarchs with their billions pillaged from their state and less fortunate compatriots –  following heavy lobbying by their friends in maritime businesses and associations.

Nevertheless, the charges still applied to Italian owners of boats. So what do you do if you are one of these? Nothing could be easier for a deep pocketed Italian with access to the best legal and financial advice money can buy than to change the ownership of the boat, arranging for it to be transferred to an obliging non-resident. That way the ports have been full, but the state coffers still empty.

The Treasury hasn’t done much better with the owners of aircraft and helicopters. By July 31 they had only paid 2% of the expected tax revenues. In this case, the circular on the implementation of the tax levy was conveniently late, and the date of payment is variable. So, later this year perhaps a bit more spare change from the pockets of the super-rich may yet get to the Italian finance ministry in Rome.

Despite headlines suggesting a reign terror waged against the elite by the tax authorities, Italy’s 1% can rest easy. La Dolce Vita rolls on…

Tom Gill is a business and political journalist in the UK and Italy. He currently writes on European matters from a radical left perspective at www.revolting-europe.com.

COMING IN SEPTEMBER

A Special Memorial Issue of CounterPunch

Featuring recollections of Alexander Cockburn from Jeffrey St. Clair, Peter Linebaugh, Paul Craig Roberts, Noam Chomsky, Mike Whitney, Doug Peacock, Perry Anderson, Becky Grant, Dennis Kucinich, Michael Neumann, Susannah Hecht, P. Sainath, Ben Tripp, Alison Weir, James Ridgeway, JoAnn Wypijewski, John Strausbaugh, Pierre Sprey, Carolyn Cooke, Conn Hallinan, James Wolcott, Laura Flanders, Ken Silverstein, Tariq Ali and many others …

Subscribe to CounterPunch Today to Reserve Your Copy

 

Tom Gill edits Revolting Europe.

More articles by:

CounterPunch Magazine

minimag-edit

Weekend Edition
August 26, 2016
Friday - Sunday
Paul Buhle
In the Shadow of the CIA: Liberalism’s Big Embarrassing Moment
Andrew Levine
How Donald Trump Can Still be a Hero: Force the Guardians of the Duopoly to Open Up the Debates
Rob Urie
Crisis and Opportunity
Louisa Willcox
The Unbearable Killing of Yellowstone’s Grizzlies: 2015 Shatters Records for Bear Deaths
Charles Pierson
Wedding Crashers Who Kill
Richard Moser
What is the Inside/Outside Strategy?
Dirk Bezemer – Michael Hudson
Finance is Not the Economy
Jeffrey St. Clair
Roaming Charges: Bernie’s Used Cars
Margaret Kimberley
Hillary and Colin: the War Criminal Charade
Patrick Cockburn
Turkey’s Foray into Syria: a Gamble in a Very Dangerous Game
Ishmael Reed
Birther Tries to Flim Flam Blacks  
Brian Terrell
What Makes a Hate Group?
Howard Lisnoff
Trouble in Political Paradise
Terry Tempest Williams
Will Our National Parks Survive the Next 100 Years?
Ben Debney
The Swimsuit that Overthrew the State
Ashley Smith
Anti-imperialism and the Syrian Revolution
Andrew Stewart
Did Gore Throw the 2000 Election?
Vincent Navarro
Is the Nation State and Its Welfare State Dead? a Critique of Varoufakis
John Wight
Syria’s Kurds and the Wages of Treachery
Lawrence Davidson
The New Anti-Semitism: the Case of Joy Karega
Mateo Pimentel
The Affordable Care Act: A Litmus Test for American Capitalism?
Roger Annis
In Northern Syria, Turkey Opens New Front in its War Against the Kurds
David Swanson
ABC Shifts Blame from US Wars to Doctors Without Borders
Norman Pollack
American Exceptionalism: A Pernicious Doctrine
Ralph Nader
Readers Think, Thinkers Read
Julia Morris
The Mythologies of the Nauruan Refugee Nation
George Wuerthner
Caving to Ranchers: the Misguided Decision to Kill the Profanity Wolf Pack
Ann Garrison
Unworthy Victims: Houthis and Hutus
Julian Vigo
Britain’s Slavery Legacy
John Stanton
Brzezinski Vision for a Power Sharing World Stymied by Ignorant Americans Leaders, Citizens
Philip Doe
Colorado: 300 Days of Sunshine Annually, Yet There’s No Sunny Side of the Street
Joseph White
Homage to EP Thompson
Dan Bacher
The Big Corporate Money Behind Jerry Brown
Kollibri terre Sonnenblume
DNC Playing Dirty Tricks on WikiLeaks
Ron Jacobs
Education for Liberation
Jim Smith
Socialism Revived: In Spite of Bernie, Donald and Hillary
David Macaray
Organized Labor’s Inferiority Complex
David Cortright
Alternatives to Military Intervention in Syria
Binoy Kampmark
The Terrors of Free Speech: Australia’s Racial Discrimination Act
Cesar Chelala
Guantánamo’s Quagmire
Nyla Ali Khan
Hoping Against Hope in Kashmir
William Hughes
From Sam Spade to the Red Scare: Dashiell Hammett’s War Against Rightwing Creeps
Raouf Halaby
Dear Barack Obama, Please Keep it at 3 for 3
Charles R. Larson
Review: Paulina Chiziane’s “The First Wife: a Tale of Polygamy”
David Yearsley
The Widow Bach: Anna Magdalena Rediscovered
FacebookTwitterGoogle+RedditEmail