Paolo Gentiloni, the new Moscovici

ABBL Published 04.10.2019

Italy was the last country to bring a name for the von der Leyen Commission and this name was Paolo Gentiloni, the former Italian Prime Minister and, polls confirmed, the most-loved Italian politician. Sometimes, journalists refer to him as the successor of Romano Prodi.

Within the new Commission, he has been assigned the Economy and Taxation portfolio, currently held by the Frenchman Pierre Moscovici. This comes a bit as a surprise as Italy is struggling with the European public deficit rules and as his long political career does not account any economic or financial position. Gentiloni is, nonetheless, a well-prepared politician, a mediator, and a pro-European striver. Indeed, his candidacy reflects the approach adopted by the newly formed Italian government, which wishes to get back in touch with European institutions.

Gentiloni was Italian Prime Minister, from 2016 to 2018, and before that he was appointed Minister of Foreign Affairs to succeed Federica Mogherini, who became High Representative of the Union for Foreign Affairs and Security Policy. He has also been the Chairman of the Broadcasting Services Watchdog Committee in Italy, overseeing the publicly funded Italian broadcasts. Then, during the Prodi’s government, from 2006 to 2008, he was Minister for Communications.

The Italian Commission nominee is not an economist. It must be said, though, that his cabinet obtained very good results in terms of economic recovery and unemployment rates. Even the spread was at its lowest levels since the financial crisis that hit Italy in 2011. At the time, Gentiloni was able to take the lead in response to the threat by the European Commission of opening an excessive deficit procedure against Italy at the end of 2017. His Finance Minister, Pier Carlo Padoan, adopted several measures to cut the budget deficit, by improving tax collection and fighting tax evasion.

Perhaps, his experience in economic matters can be embedded in his ability to impose non-populist taxation measures and to compromise with European institutions. Indeed, during his public hearing before the European Parliament’s committee, held on Thursday 3rd October, he committed to cooperate as much as possible with the relevant parliamentary committees and political groups. Also, he outlined clear priorities to reform the European taxation system and to include environmentally sustainable clauses, like the carbon border tax and the European Green New Deal.

The priorities of his portfolio reflect the ones contained in the von der Leyen’s mission letter to Gentiloni. Among his priorities he stated in his hearing in front of the European Parliament first an effective taxation system including a carbon border tax, second the reform of the international corporate tax system and thirdly the fight against tax fraud and evasion. On the two latter he commits to the international negotiations on digital taxation aiming at a compromise at the OECD next year. Questioned by the far left on what he intends to do regarding tax havens inside the European Union, in particular Luxembourg and Ireland, he commits to taking the issue on board and invites the European Parliament to adopt a clear position.

He also stated in several cases that he will cooperate with Commissioner-designate for Financial Service Valdis Dombrovskis. Gentiloni will surely focus more on fiscal and taxation policies, rather than economic proposals, relying for the most on Dombrovskis, his supervising Commission Executive Vice-President.

By Silvia De Iacovo – ABBL & ALFI Representative Office in Brussels

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