The tax compliance smothering Italian SMEs Presented by Luciano Monti Adjunct professor of European Economic Policy LUISS Guido Carli at the Conference “Tax compliance costs for the SMEs sector” held in Rome, May 21st 2015 Translation from original set in Italian language

The relevance of tax compliance (within the fiscal Italian system)

Estimated tax compliance economic impact by fiscal tool (procapita euro for company) Corporate income tax Corporate tax VAT Retention taxes Excise taxes Minor and local taxes

Estimated internal company procapita costs for tax compliace (in euro) Micro company Small company Medium company Medium cost Source: elaboration ISTAT 2011 data and estimates

Estimated total tax compliance costs in billion euro in 2011 Micro companies Small companies Medium companies Source: elaboration ISTAT 2011 data and estimates

Quota of total estimated tax compliace in the SMEs sector Source: elaboration ISTAT 2011 data and estimates

Estimate internal and external tax compliance costs in billion euro Internal costs External costs Micro companies Small companies Medium companies Source: elaboration ISTAT 2011 data and estimates

The shadow costs of the Italian fiscal system 0,5 medium companies 3,2 small companies 25,4 micro companies Source: elaboration ISTAT 2011 data and estimates

Source: elaboration ISTAT 2011 data and estimates Tax compliance costs vs. Research&Development investments in the private SMEs manufacturing sector (in billion euro) R&D Italian companies yearly investments Tax compliance yearly cost for manufactoring sector Source: elaboration ISTAT 2011 data and estimates