Negative reactions, exacerbated by the electoral battle, followed the proposal formulated by Enrico Letta.
The secretary of the Democratic Party has proposed an inheritance tax of up to 20 percent for those who inherit more than five million euros in order to finance a “dowry” of ten thousand euros for those who turn eighteen, thus challenging the second curse to talk about raising taxes is an electoral suicide (Matteo Renzi emphasized it, among others, with his usual vehemence). Others consider it “a step forward”, “minimal” but “radical”, which relaunches the themes of investing in young people and the redistribution of wealth (Roberta Carlini on 4 August on The essential).
The proposal seems to me instead, even from the perspective of those who support it, impromptu and not very credible.
In the meantime, I think it is a serious mistake to isolate it from the overall picture of income and property taxes. Think of the Imu, the tax on the possession of real estate, now clearly unfair, on the one hand due to the failure to reform the land registry and the millions of uncensored properties that escape taxation, and on the other for the revaluation that has already largely occurred in large cities, with an imbalance with respect to the rates that had been thought of in the previous situation. It is not difficult to find properties with an even higher yield than their market value, with vexatious consequences.
Eighteen-year-olds to vote
A clearer analysis is needed, then, to avoid the impression that everything boils down to a wink at the 18-year-olds called to the first vote. That the proposal ends up being reduced to a demagogic expedient is also denounced by those who, like Tito Boeri and Roberto Perotti in la Repubblica of 8 August, subscribe to the redistributive purposes of the Letta proposal, and also the rationality and equalization capacity of the inheritance tax , but he rightly points out that there are thousands of more useful things for young people and families to do.
According to current data (reported by Carlini), the number of taxpayers would be made up of just 500 thousand people (0.8 percent of the Italian population). What revenue could be derived from it? On a total levy of 500 billion euros per year, the “old” inheritance tax (with rates up to 31 percent and not limited to 0.8 percent of the population), abolished in 2001 and finally reintroduced to the extent now considered too much small, gave a revenue of 700 billion lire (1993 data).
A dubious effectiveness
The current revenue (about one billion euros) derives, for its part, from medium-small taxable income, especially real estate, while other estimates speak of revenue from the Letta proposal that would settle between one billion and four billion lire (it is the hypothesis mentioned by Boeri and Perotti). But the great estates escape the imposition of succession and so, Raffaello Lupi noted some time ago with the usual humourends up having a tax “on accidents”.
Even if the levy on income and then on the free transfer affects a wealth that modifies its nature in the creation and then in the transfer (and can be said, therefore, in a rational abstract line), the succession remains the result of economic activities already taxed as income and then as assets (Imu for real estate, stamp duty for movable wealth). On the other hand, the accumulation of savings assumes a social security function for the old age and safety of descendants, and a greater withdrawal could discourage the propensity to save, which is instead encouraged and guaranteed by the republic (article 47 of the constitution). These are arguments that are perhaps controversial but which must be taken on board if, instead of occasional sorties, one wants to credibly contribute to public discourse.
It is said from many quarters that redistributive interventions, the growing need for which is clear, should be addressed to families, often pushed towards an almost poverty line. The dowry, it is said again, is a bonuswhile it is necessary to intervene on the welfareon education, on income policy, if you want to propose initiatives of some significance.
For the Letta proposal, the dowry should be used for university training, starting new businesses or buying a house. One might wonder, then, with what seriousness such arguments can be proposed, given the price of real estate in urban centers, or the real cost of a new business. Unless our 18-year-olds are all new Steve Jobs and Bill Gates.
Finally, the proposal seems to me to be wrong even in the “radical” perspective that it intends in some way to please. It was born in the Anglo-Saxon culture, much more individualistic. Wouldn’t the next step perhaps end up leaving the individual alone in the responsibility of his failure? This does not open the way to a classic argument of the American right against redistribution and the welfare? The proposal does have “noble fathers” (Anthony Atkinson, Fabrizio Barca) but, as it seems to me evident, importing, transplanting ideas, methods and practices from countries with different traditions, culture and structures, not only in this field, must be considered with extreme attention.