Italy has scrapped parts of its plans to pay cash for goods and services after being criticized by the European Union authorities. Economy Minister Giancarlo Giorgetti stated on Sunday (18/12/12) that Italy had decided to abandon some of its plans.
The government proposed changing the current system in which sellers are subject to fines if they refuse to accept card payments. Transactions less than EUR60 would not be subject to any penalties.
The European Commission had a negative reaction to the move. It was inconsistent with the EU’s previous recommendations to Italy to improve tax compliance. Giorgetti informed Parliament late Sunday that the government had changed course.
He stated that he intended to eliminate the point-of-sale measure and suggested that compensatory measures be taken to assist shopkeepers in paying commissions for card transactions.
He said, “I hope there will be continued reflection at the European Level.”
According to Treasury data, critics claim that cash payments encourage tax evasion in a country where approximately EUR100 billion in taxes and social contributions is evaded each fiscal year.
For a 21-billion euro tranche of EU post COVID Recovery Fund money, Rome received in the first half of this year’s first quarter, the current penalties of 30 Euros and 4% of transaction values are one condition.
These latest developments aside, Giorgia Malta Maloni, the Prime Minister, was still generous with cash than her predecessors.
Before year-end, her first budget must be approved and confirmed by parliament. The cash payment limit is increased to EUR5,000 from EUR1,000 next year.
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