We had to chuckle when this story came out. If you’re in the market for a mega-dollar supercar or a high performance ride with some foreign cachet, consider an immediate trip to Italy and take your checkbook. An ever-increasing number of wealthy Italians are selling their look-at-me-bling at fire-sale prices just to be rid of them. Here’s why.
The economic catastrophe in Greece has been well documented in the news and has even affected the U.S. financial markets. But Italy is second on the list of shaky national economies; a default on their debt could affect the European alliance deeply. Italy has a new prime minister who is taking the challenge seriously and attempting to reduce the nation’s staggering debt through many means.
One method he’s using is a crackdown on Italy’s tax evaders, and there are heaps of them. Tax enforcement under the previous regime was lax at best and often non-existent, an attitude that encouraged many to be less than honest in their filings. That’s changing, and any outward symbol of wealth – including your car – may bring some scrutiny.
Recently, representatives of the Guardia di Finanza (the tax department) cruised through a posh ski resort area in the Italian mountains. They recorded the license plates on the assortment of Ferraris, Lamborghinis, Porsches, BMWs and similar luxury cars in the parking lots, traced the owner info and investigated whether the car was justified by the owner’s income as reported on tax forms.
Surprise, surprise! After surveying over 130 owners, the Guardia found that more than one-third of the group reported incomes of less than 22,000 Euro per year, yet many of the cars were valued at well above €100,000. A lot of folks now have “some ‘splainin’ to do.”
The idea immediately caught on elsewhere and police in various Italian cities began reporting the plates on high value cars to the Guardia. In one case, the driver of a weeks-old Mercedes was found to have filed no taxes at all.
So the very wealthy are now being scared carless, and many are selling off the hot stuff to avoid being stopped at a checkpoint or traced to their unpaid taxes. Some owners will accept any reasonable price and are selling their cars at a loss to dealers or buyers in neighboring countries.
One exporter reported that the number of Porsches leaving the country has more than tripled against the previous year, and the president of a dealers’ association noted that “owning a luxury car had become almost a crime in Italy these days.”
The most recent numbers we could find say that underpaid taxes in the U.S. are estimated to exceed $380 billion per year. Watch where you park that Ferrari.