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Italian industrial policy: reduce or abolish Irap?

Author

Listed:
  • Maurizio Ciaschini
  • Fabio Fiorillo
  • Rosita Pretaroli
  • Francesca Severini
  • Claudio Socci
  • Enzo Valentini

Abstract

The reduction (or abolition) of regional tax on productive activities (Irap, Imposta regionale sulle attività produttive) could stimulate the industry competitiveness. Analysis of the reform scenarios should not neglect the effects of the consequential changes in income distribution. Here we use a computational (Cge) model imple-mented on a Social Accounting Matrix describing the circular income flow with the aim of assessing the impact of possible reform scenarios on production, income, prices of goods and of primary factors, employment and the state budget. The analy-sis is carried out by comparing a possible Irap reform with an alternative plan to al-locate an equivalent amount of resources to reducing Income tax (Ire, Imposta sul reddito) rates.

Suggested Citation

  • Maurizio Ciaschini & Fabio Fiorillo & Rosita Pretaroli & Francesca Severini & Claudio Socci & Enzo Valentini, 2008. "Italian industrial policy: reduce or abolish Irap?," QA - Rivista dell'Associazione Rossi-Doria, Associazione Rossi Doria, issue 1, March.
    • Handle: RePEc:rar:journl:0072
    as

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    References listed on IDEAS

    as
    1. Pissarides, Christopher A., 1998. "The impact of employment tax cuts on unemployment and wages; The role of unemployment benefits and tax structure," European Economic Review, Elsevier, vol. 42(1), pages 155-183, January.
    2. Fabio Fiorillo & Emanuele Montesi, 2004. "Impatto sul reddito disponibile di tariffe e imposte locali," ECONOMIA PUBBLICA, FrancoAngeli Editore, vol. 2004(6).
    3. Fabio FIORILLO & Francesca SEVERINI, 2006. "Manovre fiscali regionali e livello di occupazione," Working Papers 249, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    4. Fabio FIORILLO & Claudio SOCCI, 2002. "Quale politica fiscale regionale? Analisi del federalismo italiano attraverso un modello CGE," Working Papers 178, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    5. Graham Pyatt, 1999. "Some Relationships between T-Accounts, Input-Output Tables and Social Accounting Matrices," Economic Systems Research, Taylor & Francis Journals, vol. 11(4), pages 365-387.
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    More about this item

    Keywords

    Irap; Ire; CGE; Social Accounting Matrix;
    All these keywords.

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • D50 - Microeconomics - - General Equilibrium and Disequilibrium - - - General
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies

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