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Pay up or weigh anchor? Italy's yacht owners feel the tax collector's heat

The Italian government is targeting yacht owners in a crackdown on tax evasion. Is that why marinas are emptying out?

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The agency’s officers cross-reference the details with the amount of earnings boat owners had declared to see if they could afford the purchase. The tax police pointed out that their checks had revealed startling cases of tax avoidance.

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When the Guardia di Finanza officers checked 963 yachts moored in a picturesque marina in Bari, a port on the Adriatic coast, they found that 286 – nearly one-third – were owned by people who had filed suspiciously low tax returns, or no tax returns at all. In the most extreme case, inspectors found a yacht worth 1.2 million euros owned by a businessman who had never filed a tax return in his life. Another vessel, worth an estimated 700,000 euros, was owned by a company that had declared annual revenue of just 1,300 euros.

'Obsessive' authorities

Despite those discoveries, the boating sector insists that the majority of owners are honest and are being unjustly persecuted because of the sins of a few.

“It’s absolutely right that tax evaders should be caught, but just because you own a boat doesn’t mean you are dodging taxes,” says Giovanni Sorci, the director of a marina at Rimini, a popular holiday resort on the Adriatic coast.

“The authorities are obsessive. They don’t just check you once – they come back the next day, too. And there are five or six agencies involved - the police, the Carabinieri [a paramilitary police force], the Guardia di Finanza, the Coast Guard ... even the Forestry Corps!” he adds.

He said his marina had lost 40 boats in the past few months, with many fleeing to Slovenia, while others had set sail for Croatia, Montenegro, and Greece.

The anger and exasperation of many honest yacht owners was summed up by a notice placed on a boat in a marina at Rapallo, on the Italian Riviera. “Have mercy. This boat has already been checked seven times.”

Self-fulfilling prophecy

Tax evasion has gone on for decades in Italy. In many ways, it is a self-fulfilling prophecy.

A disgruntled citizen looks at the potholed roads and poorly equipped schools in his neighborhood and concludes that the government is so ineffective that it is not worth paying taxes. But by withholding money from the state, those services get even worse.

Sometimes collusion in tax dodging comes from the very top. Silvio Berlusconi, who was forced to resign as prime minister last November as Italy was swept up in the eurozone crisis, said once that it was important to “defend the rights of tax evaders,” or, as he put it more euphemistically, “companies that make mistakes.”

Mr. Befera, the head of the tax collection agency, said Italy had a  “cultural deficit” in which many Italians “give a nod and a wink” to tax evasion – something he is hoping to stop.

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