Flat Tax - A Fair, Simple and Transparent Reform for Italy
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1 The Flat Tax: A Fair, Simple and Transparent Reform for Italy Dr. Alvin Rabushka Hoover Institution - Stanford University - Stanford, CA USA ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
2 Even Einstein Can t Understand the Income Tax Code ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
3 ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
4 ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
5 ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
6 ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
7 ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
8 ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
9 Tax Revenue as % of GDP in Italy (Excluding Social Security) % % % % % % % % ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
10 Total Tax Revenue as % of GDP in Italy (Including Social Security) % % % % % % % % % % % % ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
11 Changes in Tax to GDP Ratio in Italy Percentage Points by Decade % 25/25 in OECD % Second % First % Sixth Between , Italy ranked first in OECD ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
12 ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
13 ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
14 ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
15 Italy individual income tax rates 2014 Tax (%) Tax Base (EUR) 23% 0-15,000 27% 15,001-28,000 38% 28,001-55,00 41% 55,001-75,000 43% 75,001 and over Note: An additional 3% solidarity tax is imposed on all personal income exceeding EUR 300,000. ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
16 Countries or Jurisdictions With a Flat-Rate Tax (Includes Personal Exemption or Allowance. Effective Zero Rate on First Tranche of Earnings or Self- Employed Business Profits) Abkhazia 10 Albania 10 Anguilla 3 Belarus 12 Belize 25 Bolivia 13 Bosnia and Herzegovinia 10 Bulgaria 10 Czech Republic 15 (Temporary 22 upper bracket) Estonia 21 Georgia 20 Greenland 37 (plus municipal flat rate of 5 or 8) Grenada 30 Guernsey 20 Guyana 33.3 Hong Kong 15 Hungary 16 Jamaica 25 Jersey 20 Kazakhstan 10 Kyrgyzstan 10 Latvia 24 Lithuania 20 Macedonia 10 Madagascar 20 Mauritius 15 Mongolia 10 Montenegro 9 Nagorno-Karabakh 5 Pridnestrovia 10 Romania 16 Russia 13 Serbia 12 St. Helena 25 Seychelles 15 Slovakia 19 (Temporary 25 rate) South Ossetia 12 South Sudan 10 Switzerland 11 (plus cantonal and municipal) Timor-Leste 10 Trinidad and Tobago 25 Turkmenistan 10 Tuvalu 30 Yemen 15 ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
17 Revenue Growth: Russia s 13 Percent Flat Tax ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
18 Rabushka with Mart Laar, Prime Minister of Estonia, Who Adopted the Flat Tax in 1994 ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
19 Criteria for Evaluating Income Taxes Equity: Fairness; (aka Social Justice) What s Fair and Just? Horizontal Equity (Equal Treatment Under Law) Vertical Equity (Progressive) Simplicity Administrative Ease of Compliance Comprehensibility Economic Efficiency Scope and Level of Taxation (Crowding Out) Minimize Economic Distortions Neutrality Across All Lines of Production Minimize Tax Evasion and Avoidance Purpose Collect Revenue Achieve Social Policy Goals ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
20 Free Book On-Line ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
21 Hall-Rabushka Personal Income Tax Form ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
22 20% Flat Tax with Personal Allowance Creates Progressive Income Tax Income Personal Allowance Taxable Income Tax Paid $20,000 $20,000 $0 $0 0 $30,000 $20,000 $10,000 $2, % $40,000 $20,000 $20,000 $4,000 10% $50,000 $20,000 $30,000 $6,000 12% $60,000 $20,000 $40,000 $8, % $70,000 $20,000 $50,000 $10, % $80,000 $20,000 $60,000 $12,000 15% $90,000 $20,000 $70,000 $14, % $100,000 $20,000 $80,000 $16,000 16% $200,000 $20,000 $180,000 $36,000 18% $300,000 $20,000 $280,000 $56, % $1,000,000 $20,000 $980,000 $196, % Effective Tax Rate ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
23 Features of the Flat Tax Broad Base (Minimize/Eliminate Deductions, Exemptions, Credits, Subsidies) Only Allow Personal Exemption to Remove Low-Income Households From Income Taxes and Create Progressivity Low Rate Sufficient to Fund Legitimate Expenditures of Government Encourage Risk-Taking Reduce Tax Avoidance and Tax Evasion Reduce Corruption (Bribery) Reduce Pressure for Special Benefits Reduce Lobbying Reduce Litigation ALIQUOTA UNICA 15% SI PUÒ - Alvin Rabushka, PIN, Lega Nord - Milan, December 13,
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