Italy's Tax Amnesty Brings in $114 Billion

MILAN -- Requests by individuals to repatriate funds under a tax-amnesty plan launched in October totaled about €80 billion (about $114 billion) as of Dec. 15, a top government official said Tuesday.

Last week Economy Minister Giulio Tremonti said the government extended the tax amnesty plan to April 2010, in a move to collect more assets currently deposited out of the country, but increased the fee to be paid to 7% of the total value of the assets. Investors that repatriate assets by Feb. 28 will pay a 6% fee, the ministry said.

The Italian government in October launched the tax-amnesty plan, the third in the past eight years, which allowed Italians to repatriate funds deposited in tax havens out of Italy through Dec. 15. As part of the plan, people would have to pay a 5% fine on the total amount of assets repatriated and wouldn't have to declare how they earned the money. In November, Mr. Tremonti estimated windfall tax revenue for the government at up to €4 billion.

Small domestic asset managers as well as private-banking boutiques have benefited most from the flood of new funds, as Italy's two largest domestic retail banks -- Intesa Sanpaolo SpA and UniCredit SpA -- weren't able to attract large sums of assets deposited offshore, according to several people involved in the tax-amnesty plan.

From Ceausescu to the New Italy

he recent election in Romania, in which President Traian Basescu was re-elected with 50.3% of the vote, underlined why, 20 years after the fall of Ceausescu, Romania has become the new Italy.

In both countries, politics are hard-fought, polarized, and periodically bizarre. The comedy and melodrama of Italian Prime Minister Silvio Berlusconi are well known. But the failed impeachment of Mr. Basescu and the odd bedfellows and political pillow fights of Romanian politics are rarely noted outside Bucharest.

The parallels are remarkable. Both countries reclaimed democracy when they executed their dictators Benito Mussolini (April 28, 1945) and Nicolae Ceausescu (December 25, 1989). Both emerged from dictatorship flat on their backs economically and with many friends in the West fearing they would not sustain democracy. And within 20 years, with support from America and Western Europe, both became firmly democratic, much more prosperous, and economically and militarily relevant members of the European Union and NATO.

2nd UPDATE:Italy Econ Min: EUR95B Declared Under Tax Amnesty

MILAN (Dow Jones)--Under the Italian government's tax amnesty plan, assets worth EUR95 billion have been declared, of which 98% will be brought back to Italy from offshore, the Italian Economy Ministry said Tuesday, citing data as of Dec. 15.

"This is a positive dividend from the London G20," said Economy Minister Giulio Tremonti in a phone interview. "The era of banking secrecy is over."

Tremonti was referring to the meeting of the Group of 20 industrial and developing nations in London in April where world leaders took measures aimed at repairing the financial system to lift the economy from a global recession.

The EUR95 billion figure was well above the ministry's previous total of EUR80 billion. The higher figure is because of "a lastminute acceleration" in people making a voluntary disclosure, Tremonti said.

In an emailed statement, the ministry also said the extension of the plan to April 2010 would be the "last one and definitive." In December, Tremonti announced the extension of the plan but with higher fees. Italians who repatriate assets by Feb. 28 will have to pay a 6% fee on those assets, while assets declared by April 30 will have a 7% fee.

Tremonti declined to give a forecast of the total amount of funds that could be disclosed and repatriated.

In October, the Italian government started a tax amnesty plan that allowed Italians with undeclared assets hidden in tax shelters outside the country to repatriate them by paying a 5% fee.

Small is beautiful for Italy's tax amnesty

MILAN, Dec 18 (Reuters) - Smaller institutions appear to have benefited more from funds being repatriated under Italy's tax amnesty than larger ones, with Italy's four biggest banks collecting less than a quarter of the estimated total.

And a final rush suggests the government's decision to extend the amnesty with slightly tighter terms beyond April could bring in more than the 80 billion euros ($115 billion) which Economy Minister Giulio Tremonti was expecting.

"There was a bottleneck at the end. That could mean the extension will open up more chances," a sector source said.

LDK, SunPower Up on Italy Deals

XINYU CITY, China and SUNNYVALE, Calif. (TheStreet) -- LDK Solar(LDK Quote) was up in pre-market trading by more than 2%, after it announced overnight that it had lined up a deal with Uni Land, an Italian real-estate banking and development company, to construct photovoltaic plants totaling 20 megawatts (MW) in 2010 and 2011LDK Solar will oversee engineering, procurement and construction of the plants and will also supply the solar modules. Uni Land will finance the PV project operations.

Italy's Coin To Buy Upim In Retail Tie-Up - Source

MILAN (Dow Jones)--Gruppo Coin SpA (GCN.MI) has agreed to buy smaller competitor Upim, a deal that would create Italy's biggest department store chain, a source familiar with the agreement said Thursday.

Speaking on condition of anonymity, the person confirmed newspaper reports published earlier in the day that valued the deal at more than EUR1 billion.

Under the terms of the deal, Upim's shareholders--Investitori Associati, Deutsche Bank Real Estate Opportunities Group, Pirelli & Co. Real Estate SpA (PRS.MI) and Gruppo Borletti--and its creditors--Unicredit SpA (UCG.MI) and Natixis (KN.FR)--will get a 7.5% stake in Coin, according to one newspaper, La Repubblica.

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Vatican bank accused of laundering money

In its latest issue published on Friday, the magazine claims prosecutors are probing transactions totalling 180 million euros handled between 2006 and 2008 by Vatican bank (IOR) accounts held at Unicredit’s branch near the Vatican in Rome’s Via della Conciliazione.

Some of the funds came from the sale and purchase of real estate, and the banking operations allegedly breaking money laundering laws. Prosecutors told the magazine that they would in the next few days to question Unicredit's senior management over the suspect operations.