Italy's Irpef split: 15% of taxpayers pay for services for everyone else

They are few, about 5% of Italians who file tax returns. They alone pay 42% of the 189.31 billion generated by the Irpef. And they have not received any form of tax rebate in recent years. They are the taxpayers who declare an income of more than EUR 55,000 to the IRS and who now, if they exceed the EUR 75,000 threshold, will receive a further tax increase in the form of a cap on the use of deductions.

Ordinarily surrounded by general disinterest, they receive public attention once a year with the presentation of Itinerari previdenziali's Observatory on tax revenues. The research centre led by Alberto Brambilla illustrated the new figures today at the Chamber of Deputies at an event organised with Cida, the confederation of managers and senior executives led by Stefano Cuzzilla. The figures say two things: that the poor Irpef, pierced by substitution schemes and evasion, has become structurally transformed into a club for the few who pay for everyone else. And that the strong economic growth experienced in the immediate aftermath of Covid, and photographed by the 2023 declarations on the 2022 incomes covered by the latest analysis, has only marginally changed the picture.

Revenues grew by 6.3 per cent in one year, i.e. slightly less than the nominal GDP, which rose by 7.7 per cent in 2022. And the shape traditionally crushed by the pyramid of declared incomes has also changed a little: because the number of taxpayers with incomes between 20 and 29 thousand euro has risen (9.5 million), as has the number of those with incomes from 29 thousand euro upwards, while the number of declarations indicating incomes up to 20 thousand euro has decreased, falling from 23.133 to 22.356 million. But these small shifts do not change the substance of the matter: 45.16% of Italians have no income (or do not declare it), and consequently live off someone else. And that someone is represented by 15.26% of taxpayers, who declare incomes over 35,000 euro and pay 63.39% of the Italian Irpef. A minority of the 'rich', and faithful to the IRS, who pay for health and welfare for everyone else and have so far been excluded from any form of facilitation.

Now there is discussion about the 'middle class', and the possibility of adjusting the rate a little for the middle-income brackets if the preventive agreement will offer somewhat more generous resources than the forecasts dominating the eve. But, if it goes well, it will still be a palliative, in a country of the 'official poor' that from 2008 to 2022 has seen Irpef revenue grow by only 25% while welfare spending has more than doubled.