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Tax cheats fill Italy's Christmas stocking

Tax cheats fill Italy's Christmas stocking
A tax amnesty program started by the Italian government a year ago has brought in a return of nearly €60 billion in undeclared wealth, according to the country’s economy ministry.

The so-called voluntary disclosure program which ended in November was introduced as the last chance for tax dodgers to declare income and taxable assets hidden abroad.

As a result the tax authorities got 130,000 voluntary declarations, Italy’s Treasury said in a statement Wednesday. The undeclared assets yielded €4 billion in taxes and penalties, it added.

About 70 percent of the hidden funds were stored in Switzerland, followed by Monaco, the Bahamas, Singapore and Luxembourg. The statement said more than a quarter of the disclosed sum will be repatriated to Italy. The amnesty allowed tax dodgers to keep the money abroad as long as it was declared in Italy.

The authorities warned that those who didn’t take advantage of the amnesty risk eight years in jail if they are caught. In addition, the government inked a number of deals to exchange tax information with offshore hubs popular with Italians.

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The economy ministry praised the voluntary cooperation scheme as a success, saying the “era of banking secrecy is over.”

“The voluntary disclosure changes the relationship between the taxpayers and the state,” said Deputy Finance Minister Luigi Casero. “Many were skeptical when we launched it, but results in numbers and participation proved them wrong.”

The disclosed money could be of an additional help for the Italian government which estimates the annual losses due to tax evasion exceed €90 billion. The government wants to meet its €27- €30 billion budget targets despite Italy’s economy slowdown and a €2.2 trillion debt. It also aims to reduce its budget deficit to 2.6 percent of GDP this year from last year's level of three percent.