Cash, how much it costs us to raise the roof

Unions, Confindustria, Bank of Italy and also the Parliamentary Budget Office (Upb) they are all againstraising the ceiling on cash. All, except the Meloni government, which continues to argue that the measure does not increase thetax evasionpractically contradicting the whole economic literature on the subject, as underlined by Lilia Cavallari, president of the Upb.

The government raises the threshold for refusing payments with the POS to 60 euros

In the latest draft of the budget law, the ceiling under which merchants and professionals are no longer forced to accept digital payments rises from 30 to 60 euros

Less cash = less evasion

That the unions and Confindustria agree on something is a more unique than rare event, but when Bankitalia and the Parliamentary Budget Office join the common front, it could be the time to listen to the miracle in progress. “Economic literature is almost agrees in claiming that the increase in cash payments may lead to an increase in evasion”, Cavallari explained during his speech before the House and Senate Budget Commissions, relating to the examination of the 2023 budget bill proposed by the Meloni government.

The president then explained how, based on a 2022 study “it emerges that the increase in the cash ceiling introduced with the 2016 maneuver (from 1,000 to 3,000 euros) had the side effect of increasing theshadow economy”while another analysis concluded “that the reduction adopted at the end of 2011 (from 5,000 to 1,000 euros) has contributed to contain evasion”. In short, the data speak for themselves: more cash equals more evasion, less cash equals less evasion. Reading leaves no room for interpretation.

Because tobacconists are no longer obliged to accept card payments for cigarettes or stamp duty

The official confirmation comes through a determination by the Customs and Monopolies Agency. The trade associations had defined the extension of the obligation to tobacconists as a “nonsense”.

Cost for shops

Of the same opinion is also Bankitalia, which underlined not only the risk of favoring tax evasion but also the risk of come into conflict with the objectives and the modernity proposed by National recovery and resilience plan (Pnrr). “The cash ceiling is a barrier to crime and evasion. Studies in recent years suggest that higher thresholds favor the underground economy. There is also evidence that the use of electronic payments, thanks to their tracking, reduces tax evasion” said Fabrizio Balassone, head of the economic structure service of the Bank of Italy’s Department of Economics and Statistics, speaking before the Budget Commissions of the Chamber and the Senate.

Also, according to the study The social cost of payment instruments in Italy of Bank of Italy, the cash payment would also be more burdensome for merchants’ pockets. Indeed, Balassone specified that the costs associated with the security to which cash is subject make it less economical for merchants, compared to digital transactions with debit or credit cards.