Oh dear. Or is it ‘oh dear?’ Fabio Capello is under investigation by Italian authorities for tax evasion.
It’s difficult to know what to make of this story. At the most extreme end, it will ruin his England career if it’s proven relatively quickly, although I doubt that’ll happen.
Yet on the contrary, it seems that in Italian terms, it’s routine for high profile individuals involved in sport to be looked at, with motor-cyclist Valentino Rossi and F1 driver Giancarlo Fisichella recently under investigation.
It also doesn’t help that Capello was the Juventus manager during the infamous Moggiopoli scandal, which involved Juventus being demoted to Serie B; as well as having offshore bank accounts, and investments in property and fine art.
Tax evasion and Italians are snug bed-fellows (remember Pavarotti?) – and it’s easy to see why. So, if you’re faintly interested, let The Sight is in End try and explain the complexities of the Italian taxation system for your edification.
The Italian income tax, known as IRPEF (Imposta sui Redditi delle Persone Fisiche) is heavily progressive, with 43% of your earnings taxed if you earn €100,000+ (£75,451 in sterling according to today’s exchange rate of £0.7545 to €1; the upper threshold rate was actually higher, but thanks to Mr. Berlusconi, it was lowered).
This form of taxation is also unusual because it doesn’t just relate to your annual wage, but to the value of your property. Reassessed yearly, it amounts to a sort of sort capital gains tax.
On top of your IRPEF, there’s a social security tax that saps 10% of your income, and the ICI (Imposta Comunale sugli Immobili) – the Italian equivalent of the UK Council Tax, which is payable twice yearly and varies from area to area.
VAT is also at 20%, and the problem of taxation is such a problem that the Italian Government often declares amnesties for companies to pay monies currently held in offshore accounts.
And to finish it all off, the amount in this underground economy is supposedly so vast, that it is believed to be equal to the combined GDPs of Finland, Portugal, Romania and Hungary.
That’s a one a-spicy meata-ball, as they say. It’s also seems clear why tax evasion is known as an Italian national sport.