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Big Brother is Watching You: Welcome to Italy, the Fiscal Hell

Written by Alessandro Fusillo Subject: World News

Starting from July 2013, but stretching back to 2011, a new law by the Italian Republic has come into force that not only enables the Italian tax offices to have free access to all data stored in the bank accounts in Italy, but also compels the banks to send all account statements directly to the authorities for inspection. The bank statements will be fed into software specially designed to check if the expenses shown in the bank statements are consistent with the annual tax returns. If not, a tax audit will ensue. The software is designed in order to pick out certain expenses that don’t fit into a standard established by the Finance Ministry. For example, if there are expenses exceeding a certain amount for travels and holidays, jewelry or cars, the account, and its holder, will be subjected to a more in-depth inspection.

Hence, banking secret – or the pale imitation hereof that still remained in Italy until July 2013 – has been definitely abolished. The idea is that all financial transactions performed by any citizen must be open to control and scrutiny by the state in order to ascertain if the account holder is responsible of the heinous crime of tax evasion. A famous TV-journalist went so far as to propose that fighting against tax evasion could justify the total abolition of cash and the implied possibility of tracking each and any expense. The blame for Italy’s big problems – with an enormous amount of public debt (the stock recently climbed to a staggering 130% of GDP) and an annual budget deficit that is usually higher than 3% of GDP – is equally divided, especially in the mainstream media, between the irresponsible deficit spending politics of the last twenty years and the purported huge amounts of unpaid taxes. If everyone paid his taxes, so the saying goes, the taxes would be less and the state could provide better and more services. Proposals to curtail Italy’s enormous unproductive expenses are comparatively rare in the Italian press. Moreover, pillory of tax evaders as enemies of the society and free riders that profit form the services paid for by honest citizens is quite common. The consequence is that liberty, privacy and the right to be left alone by the state have to cede in favor of the interest to ascertain with the utmost exactness the amounts of monies possessed by each and any citizen in order to tax them duly. The basic instrument for such detailed control is obviously the unrestricted access to all data stored in the bank accounts and statements.

Whereas the Snowden case enjoyed a big media coverage by the Italian newspapers and televisions, and someone expressed at least an uneasy feeling about the spying activities by the US secret service, no one dared to voice some serious protest against the implications that the recent law has as far as our freedom is concerned. If you don’t choose the wise course of action of always preferring cash and abstaining as far as possible from credit card and banking transactions, the knowledge of your bank account is bound to reveal much more than the mere amount of your annual revenues. Personal inclinations in very private matters will be open to inspection for the uniformed and heavily armed goons of the Italian Fiscal police. Any person who has an interest in libertarian and anarco-capitalist philosophy and economics – and hence who’ll likely have to buy the relevant literature on the internet by credit card transactions – will be easily revealed to the tax offices that may sample him out as a potential danger. The bank account may reveal religious or sexual inclinations and offer a wide range of information ready for use by the police and government.

Are we still free in a country like this? The answer is obvious: there isn’t any freedom left in Italy. My country resembles more and more a communist state of the vanished soviet bloc. No privacy remains: the citizen’s life has to be an open book for the government to inspect it whenever it desires so.

There are three most disconcerting features of the whole thing that make me think that George Orwell truly made an accurate prediction about the future lying ahead of us.

First, the relationship between the state and the citizens is truly revealed as that between a master and his slaves. The slave has to work for his owner and is allowed to keep for himself only such amounts as the master decides. The new law drives the point home beyond any reasonable doubt. Our efforts and the monies earned are there to be taken by the state, which will punish any attempt to hide at least something of the rich booty that has to fall prey to the state’s big appetites. Hence, the citizens shall not be given the possibility of hiding something. Since the state fashions itself as the rightful owner of any good produced by its citizens, such that the part of the annual revenues left to them is just a graceful concession, no one shall have the right to keep something in hiding from the state’s officials. Only a free man can claim a right to an inviolable sphere, a slave has no rights, but only duties. It is worth mentioning that according to the most reliable statistics the amount of GDP that is absorbed by the state’s expenses in Italy is close to 70%. This implies that comparing Italian taxpayers to slaves isn’t just a metaphor but a crude reality.

Second, there won’t be any part of your life that will be secret or private and free from scrutiny. All your personal feelings and inclinations are open to control and inspection. It is just a small leap from the new law about bank statements to an Orwellian Thought-police. The state claims a full right to control citizens’ expenses and hence their minds and opinions. Once the principle is established that it has a right to control how money is spent, there will be less and lesser limitations to the state’s ever-increasing power. The common argument to sustain the new law’s utility is that all those who didn’t do anything wrong (i.e. who have paid all their taxes in full) don’t need to fear anything, but there exactly lies the flaw. Not only are taxes theft, and hence any effort directed to hide one’s revenues from the state’s greedy hands is a just act of self-defense, but even if the state would pursue a noble scope (such as defending the citizens’ life, liberty and pursuit of happiness) this would never justify a curtailment of freedom.

Third and worst, there is the idea of equality that lies behind the design of the software used to check the account statements. The Ministry will establish an average citizen according to the idea of the state. Whoever does not fit into the pattern of the average citizen is a potential enemy of society, a tax evader who has to be controlled and if the case may be, punished for not paying the taxes and for his sin to be different. The citizens are not meant to be unique individuals each one different form the others. The ideal is an absolute equality where any difference will be singled out as a potential threat. In the final analysis, this will promote behavior that fits within a normal pattern and avoids to be spotted as not usual. Whoever doesn’t wish to receive a visit by the fiscal agencies should rather prefer to adjust his expenses in order to avoid stirring the attention of the computer in charge with checking the bank statements. Now, this proves that we live in a totalitarian bureaucracy and that democratic checks and balances can’t do anything to stop Leviathan. An elected parliament is just one of the instruments of the state’s power and there is no doubt that its members are more than happy to pass a law designed to enhance the state’s effectiveness in appropriating the citizens’ resources used to pay the members’ of parliament fat paychecks. That’s how modern totalitarianism works: in order to enslave the citizens, the state only needs to distribute a part of the loot to selected persons and to convince a vast majority that it is pursuing the common weal and the trick is done. The important thing is to avoid that the people start again thinking with their own head instead of thinking the ideas fed to them by the mainstream media.

Now, although this should induce a gloomy outlook, there still is space for hope. Italy used to be a country where great individualities shaped the arts, music, literature, science, philosophy. Moreover, Italians used to be “natural anarchists”. By instinct, they don’t trust government; they don’t believe what they are told and always try to find their personal ways and solutions. What nurtured both outstanding personalities and the simple individual’s smart and personal way to solve the problems was a philosophy and social ambience that fostered individual achievement and effort. Our modern state strives to kill that off. Will it succeed?

I don’t think so. Underground unorganized rebellion is gaining momentum. People refuse to use the banks and prefer cash. The man of the street clearly sees that it’s all about appropriating his money, earned with hard work. The rise of the value added tax from 19% to 21% in a few years determined a reduction in the revenues from the tax (a striking practical evidence of Laffer’s famous curve). There are persons who publicly advocate tax rebellion and secession form the Italian Republic. What is needed is an effort to change people’s minds, to free them from the statist philosophy that they learn since their first years in school and to nurture the Italians’ attitude as natural anarchists. And what is true for my country is true for any other country. We libertarians may be few, but we can plant seeds of liberty and of doubt. The state is a psychological phenomenon. Change the mind of the persons and the state won’t survive a few days.