US embassy cable - 05ROME2998

UNCLAS ROME 002998 
 
SIPDIS 
 
 
SENSITIVE 
 
STATE FOR USAID 
 
E.O. 12958: N/A 
TAGS: ECIN, EAIR, EAID, EFIN, IT, UNGA 
SUBJECT: DEVELOPMENT FINANCE: ITALY SAYS ANY GLOBAL TAX 
MUST BE VOLUNTARY 
 
REF: STATE 162146 
 
Sensitive but Unclassified.  Not for distribution outside USG 
channels, not for Internet publication. 
 
1. (SBU) Summary: Italy does not oppose global tax schemes to 
fund development assistance, provided such programs are 
voluntary.  There are no plans here to impose a surcharge on 
international airline tickets, and Italy would resist efforts 
by the EU to imposed such a tax on member states.  Italy is 
supportive, in principle, of the International Finance 
Facility (IFF), and plans to join a pilot IFF to fund 
immunization programs.  End summary. 
 
2. (SBU) Econoff delivered reftel points to Claudio Spinedi 
in the Ministry of Foreign Affairs Directorate General for 
Multilateral Economic and Financial Cooperation.  On "global 
taxes," he characterized the Italian position as "not very 
far" from the United States in that Italy does not want new 
external taxes imposed on its citizens.  Rather, Italy would 
only support a tax on international airline tickets or 
financial transactions that is fully voluntary for individual 
states.  Italy would "not look favorably" on an attempt to 
require the collection of such taxes in EU states, but has no 
problem with other states, such as France, placing a 
surcharge on tickets sold within their borders. 
 
3. (SBU) On air travel taxes, Spinedi agreed with USG 
arguments that imposing a tax on air travel may be 
inappropriate, given the hard times faced by the airline 
industry.  (Econoff also spoke with National Civil Aviation 
Authority (ENAC) International Affairs Director Fabio 
Marchiandi, who stated the airline ticket surcharge would be 
unpopular among Italian aviation interests.) 
 
4. (SBU) Italy supports "in principle" the UK-proposed 
International Finance Facility, Spinedi explained, but does 
have concerns about the "financial and governance mechanisms" 
of such a system.  Italy is considering participation in a 
smaller, separate pilot facility to support immunization 
programs in the developing world.  Spinedi agreed that 
recipient countries may lack the capacity to absorb the 
larger aid flows effectively, but Italy is supportive of the 
concept of an IFF. 
 
5. (SBU) Separately, Econoff met with Francesca Manno and 
Maria Luisa Panzica of the Finance Ministry's International 
Relations Office.  The two expressed some support for the 
airline ticket surcharge, but acknowledged that 
implementation could be a challenge.  Manno believes that the 
recent proliferation of international development initiatives 
spread out among different Italian ministries result in 
overlap and monitoring problems.  Manno expressed her 
personal opinion that the MFA should oversee all Italian 
development initiatives to avoid these problems. 
SPOGLI 
 
 
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 2005ROME02998 - Classification: UNCLASSIFIED