XINHUA, Rome :
Average family income fell in Italy in the last quarter (Q4) of 2020, the National Statistics Institute (Istat) reported Friday, pushed down by a rising tax burden measured by taking the total tax revenues received as a percentage of the country’s gross domestic product (GDP).
Istat reported that the country’s overall tax burden was the equivalent of 52 percent of the GDP in Q4 2020, the highest level since the final tally for 2014.
Government tax revenue did not increase last year, due to the economic slowdown and the reduction of some consumption-related tax rates in the wake of the coronavirus pandemic. But the overall tax burden – which includes all forms of taxes, whether income taxes, value-added taxes, or corporate taxes – grew by 1.3 percentage points due in part to the economy’s overall 8.9-percent contraction last year.
While the tax burden increased, family income dropped by 1.5 percent compared to 2019 levels, including a 1.8-percent drop in the final three months of the year alone from the previous quarter. Family income is the sum of the income of all members of a household from all sources, whether active (from work) or passive (from investments).
The saving rate of consumer households was 15.2 percent, 0.5 percentage points higher than in the previous quarter.
As a result of these trends, the overall purchasing power of the average Italian family – a measure of the goods or services that can be acquired for a unit of currency – fell even more than family income, Istat said, dipping 2.1 percent in Q4 of last year compared to the previous quarter.
