Sunday, June 5, 2016

Padoan: “We will cut the corporate income tax and personal income tax even if there is room. Bail in, careful to contagion” – The Republic

TRENTO – Pier Carlo Padoan promises that the government will give priority to helping business, confirming the cutting of taxes on corporate profits expected for 2017 and hoping you do more for the revival of productivity.

in public interview with Handelsblatt Republic and the Trento Festival of Economics, Economy Minister echoes the governor of the Bank of Italy, Ignazio Visco, speaking shortly before, he had asked the government to pursue and accelerate structural reforms. It had rejected the idea of ​​a minimum income: “Unbearable.”

Minister, does not find that in Italy the economic growth and the productivity are too slow?
“it ‘s true that you have to do more, but it is not true that growth is weak, because the confidence is growing. the low productivity is a historical problem and depends largely on intangible assets, such as human capital. I I am convinced that there are no shortcuts: I would love that you stop talking for flexibility and speak more productivity. “

the social partners are discussing reforming the bargaining. When does the government intend to take action if there were to be an agreement?
“I am a strong supporter of bargaining at the local level: increases productivity, and the remuneration of workers. That the government should intervene directly to decide the contractual level, you can discuss. I think the government can do something in terms of incentives, the rest has to be an effort that the social partners will have to take charge. “

What is the priority of the government – cutting taxes on corporate profits, income or restart investment?
“We cut taxes, and in plenty of different ways. Now there are commitments concerning the IRES to be maintained. It ‘important that companies are supported, now that there is a recovery in investment that goes speeding. If they increase investment, increase capital and increase potential growth. If there room to make further cuts to families, to cut the personal income tax, we will do so, however, there are budget constraints. “

public debt, however, remains high.
“The public debt will start to fall this year, although less than I thought a few months ago because of inflation. Debt I should mention that if my descent expectations are different from other forecasts is because I put into account the results of privatization, which, as you have seen from the recent decisions go ahead despite many pessimistic. “

Let’s talk about the Italian banking crisis. It ‘pleased with the Bank of Italy and Consob behavior? there is no confusion about their roles?
“It is not for me to judge the action of independent authorities, that are extremely well managed. On the confusion I beg to differ. Sometimes the confusion is in the hasty judgment of those who think that certain skills should be of banking supervision and are not: I am referring to some judicial events that affect the judiciary. What matters is that you work together for sustainability and stability of the Italian system. “

Why did the Italian and French governments are asking to reduce some of the capital requirements for banks?
“the capital requirements are fundamental, is one of the key lessons of the euro crisis. But it is obvious that the answer is not to increase the capital indefinitely. If the capital is too high, the ability of banks to extend credit is weakened. In addition there is a risk of adverse selection: if you ask too much capital, but markets have a different judgment and deny it, risk ending up with more fragile banks, no longer solid. How to “bail in”, I agree with what he says Visco: in its hardness ignores the risk of contagion. “

If Britain were to vote to leave the EU there could be a shocks on the financial markets. Italy as can defend themselves?
“If there is a shock on the government bond market, the first line of defense is that the European central Bank. If there was a “Brexit” – which I absolutely do not hope – the best line of defense on the part of European countries it would be to announce that the integration process goes on. Indeed, there are segments in which one can imagine an acceleration, particularly in terms of

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