Wednesday, June 09, 2010

Ferrari chairman ranks tax evasion as top problem for Italy


In a fascinating interview with BBC's Radio 4 Today programme this morning, Ferrari's charismatic Chairman Luca Cordero di Montezemolo, who is mooted to have political ambitions for the near future, ranked tax evasion and weak governance as the largest problems facing Italy.

Describing Italy's endemic tax evasion as an "absolute embarrassment" which has turned many Italians into liars, di Montezemolo said that tackling evasion should be a top priority, requiring strong action to recuperate tax revenues in order to reduce the tax burden on those who have to pay: "I don't want to pay double taxes because someone else doesn't pay."

Italy, like many other countries, faces a budget crisis. The roots of the crisis can be traced to many factors, but decades of weak tax enforcement have significantly contributed to rising state debt, rising inequality, and chronic underinvestment in human capital. It is interesting that such a senior figure, long associated with the top ranks of the Italian business community, is so forthright on the subject. Not many business leaders elsewhere show such integrity.

You can listen to the interview here - it starts around 24 minutes into the programme.

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