The income meter is back, what it is and how it works
The 'incomeometer' is back in force, an anti-evasion system that was suspended in 2018: there are 56 expenditure items that the Revenue Agency can analyze, here's how it works
BOLOGNA – Hunt for the crafty with the new ‘incomeometer‘, which will ‘x-ray’ many types of expenditure, from medicines to bills, from the mortgage to the telephone, from car expenses to holiday expenses, but not only. For example, how much you spend on plants and flowers or to keep a horse will also be checked.There’s a bit of everythingamong the items that the Revenue Agency will be able to sift through to verify taxpayers’ incomes. The analysis will start from 2016 income (but the assessments will start from 2018 onwards) and will take into account the elements already present in the tax register. Or a minimum level of spending. Here’s how it works and the expenses that will be taken into consideration.
THE INCOME METER
The income meter isn’t exactly new. Better to talk about a return, which is expected, among other things. It is in fact an anti-evasion system that has already been used in the past to identify and quantify the presumed income of taxpayers-natural persons. It was introduced for the first time in 2013 and was then suspended by the first Conte government in 2018 (waiting for more precise criteria on which expenses to control): The decree of recent days effectively reactivates it, starting from 2016 incomes: the provision, published in Official Journal two days ago, bears the signature of the Deputy Minister of Economy, Maurizio Leo. However, there are some differences: “There is no return to the old income meter– explained Leo-. The ministerial decree published in recent days in the Gazzetta finally places limits on the discretionary power of the financial administration of implement the summary assessment”.
HOW THE ASSESSMENTS WORK
Taxpayers have in any case the possibility to defend themselves with respect to what is ‘disputed’. It will work like this: the administration checks the expenditure data (available in the databases or, in the absence of all precise data, using the average expenditures per family estimated by Istat) and proportionately assumes a certain income. If it does not correspond to the declared income (in simple terms, if someone earns 10 they cannot spend 100), the tax assessment is triggered by the Revenue Agency. An assessment which is technically called “synthetic”. When does it go off? When a discrepancy of more than 20% emerges between declared income and expenses. At this point the Tax Office, with this procedure, asks taxpayers for explanations to ensure that there is no phenomenon of evasion behind this discrepancy. Taxpayers have the opportunity to defend themselves, for example by demonstrating that the money used for expenses came from income other than that obtained in the tax period. It will also be possible to clarify the expenses, claiming that the accounts are different and that we started from a previously accumulated expense fund.
WHICH EXPENDITURE ITEMS WILL BE CONSIDERED
The new decree of these days provides for the verification of 56 different types of expenditure. In addition to mortgages and rent, the taxman will also be able to control car expenses, schools, bills, food expenses, clothes but also hotels and restaurants. And that’s not all: telephone subscriptions and subscriptions to digital TV platforms will also be taken into account, plus other expenses for entertainment and free time (such as video games). Among the strangest things that have emerged are the costs of maintaining an owned horse. Naturally, the purchase of properties and land, financial securities and expenses for home work (extraordinary maintenance) are also under control, all traceable in the building bonus procedures.
