Local authorities

Traffic fines, 28.4% do not pay

In the South, a 48.2 per cent hole, 13.7 per cent of the Imu and 30.4 per cent of the Tari also disappears. Early warnings and reorganisation to improve

by Gianni Trovati

11 December 2024

4' min read

Key points

Entries that limp
The project
The Escapes
Solutions

4' min read

For every three traffic fines imposed by the municipalities, one goes directly from the solid state of the fine to the gaseous state of evasion, without passing through the liquid state of payment. In the North, evaporation is somewhat less frequent, but still involves about 25% of fines. But the phenomenon becomes endemic in the South, where 48.2% of fines remain confined to the accounting theory of assessment without ever breaking through into the operational reality of payment, setting the national average for this form of evasion from collection at 28.4%.

Entries limping along

In the fines, one encounters only the deepest version of a phenomenon that also affects other municipal revenues: each year, an average of 7.6 per cent of the municipal property tax (Imu), 15.9 per cent of the waste tariff and 17 per cent of the single property tax, which merged the old revenues for advertising and occupation of public land, also disappears.

The project

The municipalities themselves line up the figures in a survey carried out by Ifel as part of the Progetto riscossione (Collection Project), which in collaboration with Anacap (the private collection concessionaires), Aspel (the public companies in the sector) and Gruppo 24 Ore has also proposed a 'sector study' on local revenues to understand what works and what needs to be improved in the territorial collection machine.

Because the first to be concerned about assessments that fail to take the form of real revenue are local administrators, grappling with budgets that see expenses swell due to the pressure of incompressible factors such as contractual renewals or the fallout from inflation while the revenue column is stiffened by a tax lever that has been at its highest for years.

Such a scenario makes revenue shortfalls close relatives of financial crises, as shown by the almost perfect overlap between the geography of collection shortfalls and that of instability, pre-disaster and structural deficits. And with this in mind, the recovery of tax evasion can provide the oxygen that cannot be found in other ways, and can mitigate the underground manoeuvre represented by the doubtful debt fund, the compulsory provision proportional to the shortfall in collections that now freezes more than 6 billion in local budgets.

The Escapes

For this reason, the lenses of the survey focus first on collection evasion, i.e. the share of revenue assessed but not collected. This approach does not photograph all the 'black', because they focus on the taxable bases already identified and therefore budgeted without broadening their gaze to the real 'black'.

This extra step was taken by Cifrel, the inter-university research centre on local finance at the Catholic University, which, in line with Mef estimates, puts the Imu tax gap at just over 5 billion. But even net of the taxable income that escapes, variable quotas of the tax on real estate are not paid, in an increasing line that starts from 3% in the North West and rises to 13.7% in the South.

The same revenue bradyseism in the South is to be found in all the main items, starting with the Tari (road tax), which in the South leaves the coffers short of 30.4% of revenue (twice the national average and three times that of the North), aggravating a cost problem already magnified by the plant deficit and the consequent need to send waste elsewhere.

Weighing on all this is the weak link of compulsory collection, which comes into play when neither spontaneous payments nor assessment notices succeed in bringing in the expected revenue.

This last frontier is supposed to close the collection cycle, but it manages to collect only a small minority of the sums entrusted to it: it does not reach 15% in Tari and Canone Unico, it trudges up to 16.3% in Imu and rises to 28.2% in fines due to an obvious rebound effect fuelled by the deeper failures of the previous steps.

The solutions

Not all collection cats, however, are grey in the same way. Because operational experiences in the territories show that some solutions are better than others, and that sometimes just a few expedients are enough to achieve much better performance. The sector study presented by Strategic Management Partners shows, for example, the importance of outsourcing to private concessionaires or public companies outside the authority, which broaden the range of activities compared to the classic tasks of tax offices.

While Ifel emphasises the importance of travelling swiftly with assessments: because notices that start within one year from the violation increase, for example, by 7.49% the receipts from assessment and 8.52% those from compulsory collection in the Tari (municipal solidarity tax), and similar dynamics are encountered in the other items. But 36.8% of municipalities in the Tari, and even 54.3% in the Imu, declare that they start notices in the fourth or even fifth year, just before the deadline.

When the old age of income multiplies the difficulties of recovery and drastically reduces its time.

It cannot be process governance alone, however, that offers all the solutions. Which for a large share of municipalities must also pass through a rich dose of procedural simplifications. The technical menu demanded by operators is served: the opportunity of the implementing decree of the tax delegation with regard to local taxes is on the way. It is all up to the two factors to be intertwined in the best possible way.

Gianni Trovativicecaposervizio
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Luogo: Roma
Lingue parlate: Inglese
Argomenti: Finanza pubblica, enti locali, pubblica amministrazione
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