İtaly: Cashback Additional Revenue1.2 billion By 2022

70% of Italians, it emerges from the analysis, declares that the state cashback has led to a more frequent use of electronic means of payment and 39% declares that this has also determined an impact on the increase in their consumption. These numbers highlight, on the one hand, the effectiveness of the measure in bringing citizens closer to cashless payment instruments and, on the other hand, to support the dynamics of consumption in a period of crisis such as the one the country is going through.

In terms of the recovery of the underground economy and the VAT gap, Cashback can enable an additional revenue, in terms of undeclared recovery and VAT gap, for the State equal to 1.2 billion by 2022. This is what The European House highlights – Ambrosetti in the sixth edition of the Report “Italy cashless: ongoing changes and future prospects”, presented at the spring forum in Cernobbio.

The introduction of the Cashback in December 2020 generated additional consumption of € 1.1 billion, compared with expected reimbursements of € 223 million. The first final figures for the first half of 2021 make it possible to draw an estimate for 2021 and 2022. An additional effect on consumption of 9.3 billion is expected for the whole of 2021, against a financial allocation of 1.75 billions for the allocation of reimbursements and the coverage of additional expenses deriving from the implementation of the measure. For 2022, on the other hand, additional consumption is estimated at 13.9 billion, compared to expected costs of 3 billion. Starting from an average rate calculated on the consumption basket of Italian households, it was possible to calculate the additional revenue for the State deriving from consumption, for a cumulative total of approximately 4.4 billion until 2022.

Cashless “virtuous” behavior of citizens even after 2022
According to the report, the benefits of Cashback do not end in 2022, but it is estimated that the measure is able to «permeate the virtuous cashless behavior of citizens also for the following years. Although it can be hypothesized that the impact on consumption may be more evident until 2022 (thanks to the direct economic incentive of the measure), from 2022 onwards it is hypothesized that a gradual and increasing shift in payments from cash to cashless may occur, with a more significant impact on the recovery of the undeclared and VAT gap ». In fact, the document continues, it is assumed that “this phenomenon is the result of an increased cashless culture in society”.

Revenue recovery for the state and the undeclared up to 2025 equal to 9.2 billion
The survey focuses on the sum between the additional VAT revenue for the State generated by additional consumption and the recovery of the undeclared and VAT gap up to 2025. Up to 2022 a direct effect of the Cashback measure can be noted, from 2023 onwards it is it may witness an indirect effect which is due to the spread of the cashless culture stimulated by the measure in previous years. The recovery of the revenue for the State and the undeclared and cumulative VAT gap up to 2025 is equal to 9.2 billion.

From the survey carried out by the Community Cashless Society to photograph how consumption habits have changed among Italians, it emerges that the percentage of citizens who would prefer to use cards or cashless payment instruments rather than cash has increased significantly in the last year, going from 59, 7% in 2020 to 75.5% in 2021. 67% of Italians have increased the use of cashless payment instruments in recent months compared to the same period of the previous year. The most evident effect is observed among young people, where 78.1% of people between the ages of 18-24 and 73.7% of citizens between the ages of 25-30 declare that they have used cards or smartphones more for the payments.

Reviewer overview

İtaly: Cashback Additional Revenue1.2 billion By 2022 - /10

Summary

0 Bad!