San Marino. Alarm from the unions: “Let’s stop the tax bloodletting on the pensions of cross-border commuters”
“We must stop the tax drain on the pensions of more than 2,300 former frontier workers”. This is the alarm raised by the General Secretaries Enzo Merlini (CSdL), Gianluca Montanari (CDLS) following various reports from pensioners.
After the ratification of the bilateral convention against double taxation, which took place in 2013, the San Marino government announced the definitive resolution of the matter relating to the taxation of former frontier workers, i.e. that it be paid only in San Marino. Of a different opinion is the Revenue Agency, which has sent the complaints to those who have actually paid taxes in Italy, however recovering the San Marino deductions. These retirees are also asked to pay the equivalent of the taxes paid in San Marino, complete with penalties and interest, effectively perpetrating the principle of double taxation, which the Convention set out to avoid. “It was known that the interpretations differed – the union secretaries say – for some time, but no one has taken the initiative to settle the dispute, with the result that, after almost 10 years, there are dozens of pensioners who risk a very heavy bloodletting, as well as unjust”.
The dispute revolves around article 18 of the Convention which, in the case of pensions paid under social security legislation (read the ISS), provides that the taxable amount is taxed only in that State, ie San Marino. Interpretation contested by the Revenue Agency of the Emilia Romagna Region which identifies tax authority only in the resident State, i.e. Italy, without even the recognition of the tax credit.
“The Technical Commission between the two States envisaged by the Convention – underlined Merlini and Montanari – must as soon as possible get out of the regulatory-diplomatic stalemate and definitively settle the question of fiscal authority on pension income. While waiting for this to happen, it is hoped that the aforementioned actions undertaken by the Revenue Agency will be suspended”.
“In addition to the damage, the insult”, points out Agostino D’Antonio, president of CSIR, the Emilia Romagna-Marche interregional trade union council. “All of this took place in conjunction with the discussion of the Budget Law: thanks to an amendment presented by the Ligurian parliamentarians, the Italian government has cut the taxes of former Monegasque frontier workers from 23% to 5%, equipping those already envisaged for cross-border pensions of Switzerland, while those who receive their pension from San Marino would have to pay taxes in full, as well as not being able to recover the taxes withheld by the ISS. So much for fair treatment”.
“It is therefore necessary to urge the Technical Commission between the two States envisaged by the Convention – conclude the trade union secretaries – to get out of the stalemate as soon as possible and without prejudice to the need to allow the use of the tax credit, it is necessary to adopt towards the former frontier workers of San Marino a drastic reduction in Italian taxation similar to what was implemented in favor of the pension tutors paid by Monte Carlo”.