Befera has already pointed out that the Agency’s new ability to crosscheck taxpayers’ spending against declared incomes as the weapon that might win the government’s war on tax evasion. He has previously expressed the hope that, as taxpayers become more aware of the armoury now at the government’s disposal, they will be more willing to become tax-compliant voluntarily.
The ‘redditometro’ has been long in its experimental stage, but Befera explained that, as the system needed to be “sound and easy to use”, the Agency has wanted to take the time to make sure it worked well and there would be no problem when it finally went into operation.
It will look at whether a taxpayer’s declaration of taxable income is coherent with his or her overall spending capacity, as against the previous ‘redditometro’ which was based upon the possession of certain assets, such as yachts or large cars. The new system will be able to trace individuals' expenditure in more than 100 different categories to find disparities between spending and declared incomes.
The categories of spending are divided into seven areas. For example, under the category of housing are included first and second residences, mortgages, restructuring work undertaken, and furniture purchased; while information on a taxpayer’s social security contributions and insurance policies are also collected, as are recreational pursuits and a family’s education spending.
Spending capacity is based upon actual, not estimated, expenditure, and it is said that the system will be able to compare the data of over 22m families or around 50m individuals. The system’s methodology is also able to differentiate between eleven different categories of family unit including couples or singles and families with children, together with the region of Italy in which the taxpayer resides.
Most recently, simulations have been made by inserting typical taxpayer examples into the system. From the first results, it has been seen that, in many cases, the difference between the taxpayers’ lifestyle and declared income reached over 20%; the level which will, when the system is operational, mean a taxpayer will be contacted for further information.
In addition, it has been suggested that the ‘redditometro’ could also be extended to cover the taxable incomes of artisans and other individuals in business. In that case, the Agency could be able to discover, not only unpaid amounts of individual income tax (IRPEF), but also value-added tax, the regional tax on production (IRAP) and social security and welfare payments.
Read more at: Tax Times blog