Italians evade 91 billion euros of taxes per year, economy minister says

(Reuters) – Tax evasion in Italy costs the country around 91 billion euros (70.91 billion pounds) every year, equal to about six percent of national output, the economy ministry said on Wednesday.

Rampant tax evasion is considered one of the biggest problems of the euro zone’s third largest economy, which is stuck in its third recession in six years and is struggling to control its public finances.

A 148-page document published on the economy ministry’s website estimated that efforts to curb evasion had some success in recent years, with an estimated reduction of 2.3 percent in 2007-2012 from 2001-2006.

In the document, Economy Minister Pier Carlo Padoan pledged that the government would never use tax amnesties to plug holes in the budget.

This is a quick fix often used to garner revenues in the past but is considered counter-productive in the longer term because it deters citizens and firms from paying their taxes in the belief that another amnesty will be passed sooner or later.

The document showed that in 713,00 inspections conducted by the finance ministry last year into self-employed workers and companies of all sizes, 94.2 percent showed up some form of evasion.

(1 US dollar = 0.7930 euro)