Norwich bulletin., 1920-02-07

Only vague 1nIOfn1at1Dn has reached this country regarding the new finan- cial measures adopted in Italy. Very few people realize that these repre- sent complete and most drastic re- organization of the old system of taxation on land, buildings, and pri-. vate income has been replaced by a single tax Ion normal revenue on a flat maximum basis of IS per cent. supplemented by a complementary tax of the same character. on a progress sive basis, ranging from 1 to 25 per cent.
 Extra war profits in Italy have all along been subject to a. special war tax, rated progressively from 24 to 66 per cent. This tax, being graduated &C., cording to the scale of income, repre- sents an average levy of about 50 per cent. on the total extra profit
 A further levy has now been added by tax which hits increase of capital derived from the war, the aggregate of all extra profits drawn during the war-after deducting therefrom the amount paid in tax and war tax. This
 new tribute is rated progressively. and is imposed on all such balance of war
 profit, on graduated increasing scale, at a rate verying from 20 to 60 per cent, representing an average levy
 of about 45 per cent. on the taxable amount Considered in relation to the
 total war profit, this tax is to be reck-
 oned as equivalent to 22 1-2 per cent.
 It therefore follows that about 72 1-2 per cent. of ascertained war profits {i.
 e., 50 per cent. tax and war tax on profits, and 22 12 per cent. tax on increased capital) is forfeited to the Italian treasury. It will be seen from this that Italy cannot be considered second to any nation in her dealings with war profits. For some time past there has been an intention on the part of the Italian
 government to, issue a compulsory loan at a nominal interest of say 1 per cent. This idea, however, was dis carded in favor of a tax on capital, we4ich has been put into force, begin
 ming from the first of January, 1920, payable within a period Of 30 years, I and ranging from 5 per cent. to 2s per
 cent
 The tax in question is not imposed on foreign capital which includes the
 remittances of Italian credit institutes or Italian post office savings banks. Capitals up to 30.o0o lire are ex- eApted.
 The various taxes on commercial l transactions have been increased, and
 8 tax of 10 per cent. has been imposed l on all luxury coHlnOQiueS, Sucn as silk fabrics, silk stockings, gloves. At 1 the same time all railroad fares have been Increased from IS to 4S per cent.
 The additional revenue which is ex- 1 pected from the new taxation is i reckoned at two billion lire per year
 which will shortly enable the Italian l budget to balance.
 In addition to the above. a free loan ! has been issued, with a rate of inter- est of 5.71 per cent. Italian treasury ! bonds being also aceepted in payment Ten billion lire have already been l subscribed within the first week of January. A substantial portion of the
 proceeds of this new loan will be used l for the absorption of paper currency placing Italian circulation (already I less inflated than in other European countries) on a sounder basis. Altogether the financial naeasuret which have been passed by the Italian l government are perhaps the boldest i far-reaching, and the most democratic in character yet enacted. The good will and the discipline of the Italian
 taxpayer will do the rest.