With the new Sostegni decree, which will hopefully be approved by next week, the Draghi government should provide 18 billion non-repayable contributions to companies and VAT numbers in economic difficulty. This amount will add to the 27 billion in subsidies paid to businesses so far in these 14 months of pandemic. Faced with a collapse in the turnover of our economic system which in 2020 amounted to 350 billion euros, with these 45 billion in compensation, about 13 percent of the total losses would be covered: practically a trifle. To say it is the Studies Office of the CGIA.
Recalling that the budget gap of 40 billion euros was voted by Parliament on 22 April, we run the risk that these 18 billion in compensation will arrive late. Never as in this moment, in fact, the timeliness in the delivery of aid is decisive to give a little oxygen to those in difficulty. If in recent weeks the street protests have subsided, the state of crisis in which many economic sectors find themselves has further worsened. In fact, there are hundreds and hundreds of thousands of companies that are still completely closed or semi-closed. However, it is clear that compared to the previous government there has been the long-awaited change of pace. Although insufficient, the business support measure that will be approved next week has an important economic dimension that has never been achieved before.

Public debt to save the country?

The objection that is often raised by many commentators against the government's decision to provide subsidies is that in this way we dissipate public money, helping to increase the debt out of all proportion. A legitimate thesis which, however, does not grasp as a whole the reasonableness of the effects of these measures.
It is evident that these further current outgoings contribute to increasing the public debt of our country, but it is equally true that if we do not save businesses and jobs, we do not lay the foundations to restart economic growth which remains the only possibility in able to reduce in the coming years the amount of public debt that we have tremendously accumulated with this crisis.
Therefore, saving Italian micro and small businesses means safeguarding an important slice of the economy of our country. The numbers speak for themselves. Net of civil servants, businesses with fewer than 20 employees make up 98 percent of the companies in the country and employ the majority of Italians, that is to say 54,6 percent of the employed. Furthermore, these micro realities produce 37 per cent of the annual national added value, a score not found in any other large EU country.  

Draghi and Franco: aid will arrive at least until December

The CGIA Studies Office is however confident that the resources made available to businesses and the people of VAT numbers with the Sostegni bis decree will not be the last. In the first place because up to now the total stock of direct indemnities has made it possible to cover on average only 13 per cent of the losses of the Italian production system. Secondly, because the statements made towards the end of last March by both the premier, Mario Draghi, both of the minister, Daniel Franco, they were very reassuring. The Prime Minister was able to emphasize that this year "it is necessary to accompany companies and workers in the path of exit from the pandemic, this is a year in which money is not asked, money is given". The Minister of Economy, on the other hand, stated that "I expect to finish with the support measures for the economy towards the end of the year " .

Eliminate corporate taxes

To prevent future subsidies from being used by businesses largely to pay taxes, it is necessary to "impose" the elimination of taxation taxes, allowing VAT numbers and small businesses to save around € 28 billion this year. A relief that would have important dimensions which, obviously, could be reduced by allowing the zeroing of the tax burden only to activities with revenues below a certain threshold or on the basis of the loss of turnover. This loss of revenue of 28 billion was estimated by assuming to allow all economic activities with a turnover in 2019 below one million euros not to pay personal income tax, IRES and IMU on the warehouses for the current year. . These companies, which amount to about 4,9 million units (equal to about 89 per cent of the national total), should still pay local taxes, so as not to cause liquidity problems to the Mayors and Presidents of the region. Lightened by the burden of an often unjust tax, for a year they would live with less anxiety, less stress and more serenity. Not only that, but with 28 billion saved we will lay the foundations to restart the country's economy.

CGIA, support decree bis: “Only 18 billion non-repayable. Thus only 13% of the losses are covered "