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Bonomi in La Stampa: no one-off incentives. Let's cut labour taxes structurally
Saturday 30 April 2022

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"Two hundred one-off euros, as opposed to the 1,223 proposed by us, i.e. an extra month's salary for the whole working life. Thus the President of Confindustria, Carlo Bonomi, in an interview with La Stampa on the need to cut taxes on labour. "Since last September we have made our proposal to give more money to Italians and at the same time increase the competitiveness of companies, and so far we have been unheard. We need structural interventions, and the resources are there, but we also need the political will to cut the tax wedge. Everyone talks about social equity, and if anyone has a proposal that improves on what we have suggested, we are ready to support it. But so far we have not seen it'.

The leader of the industrialists went on to emphasise that 'we are aware that if you really want to hit Russia, you have to interrupt the flow of capital linked to gas imports, but we know very well that adopting this sanction and then supporting our government loyally in this decision is critical for us, it entails risks and sacrifices. But,' Bonomi continued, 'we are willing to support these sacrifices on one simple condition: that this country makes reforms, finally opens a season of what we call competitive reformismmaking the reforms that are needed to build the country of the future, to make it competitive for the future. Italy has been waiting twenty, thirty years to make reforms. Today the resources are there. There are no more excuses not to make our country a modern, efficient, inclusive, sustainable country, to give answers to inequalities'.

According to the President, however, 'the parties are already campaigning as we saw in the discussion of the last budget law', while we should focus on certain priorities, including cutting the tax wedge because 'families and workers are suffering, especially those on low incomes. We are all convinced that it is necessary to put money in the pockets of Italians and not take it out. Faced with a proposal that puts an extra EUR 1,223 a year into workers' pockets until the end of their working careers, I would have expected everyone to agree. But this was not the case. Today, companies pay two thirds of the contribution burden while one third is borne by employees. We propose, in the event of a green light to reduce the contribution wedge, to reverse this share: two thirds to employees and one third to companies. For us,' Bonomi emphatically added, 'this is the path to follow and certainly not that of de-taxing wage increases. Since I have been president of the association, contracts have been renewed for 4.7 million of the 5.4 million employees of the Confindustria companies. The high cost of energy and raw materials has decreased margins for companies and the 16% has already reduced its activities and if it goes on like this for some time yet another 30% will cut their production. Those who propose to detax any pay increases for companies while a maxi increase in government revenue is taking place have not worked a single day in the factory.

The resources, to make a 16 billion cut in the tax wedge, are there. According to Bonomi, in fact, "the Def reports that this year tax and contribution revenues will be 38 billion higher than in 2021. In addition, data already released since the beginning of the year reveal billions of additional indirect revenues from energy prices. Italian public spending in 2022 will exceed 1 trillion a year. In this context, cover for 16 billion can be found without additional deficit. Since the beginning of the year, 30 billion has been spent on bonuses. Adding up building bonuses and super-bonuses, which have allowed the relaunch of a sector in difficulty, they have become the only lever to relaunch companies, to the detriment of Industry 4.0, research and innovation. This is not possible'. 

In conclusion, he added: 'companies paid about 3 billion each year pre-Covid to finance the Ordinary Supplementary Fund, receiving benefits for their employees of between 500 and 600 million. In nine years, between 2010 and 2019, companies paid 28.4 billion, Inps paid for benefits and voluntary contributions 11.7 billion. So the companies gave the state 16.7 billion more than the money that was needed for the industrial redundancy fund. And another serious reason why the state could now use those 16 billion in lower contributions for structural interventions on labour costs to the benefit of workers. That would be a serious gesture,' Bonomi said, 'a gesture of great responsibility on the part of the country.

 

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