The Waste Tax in Italy

Abstract

This article aims to provide a general overview of waste tax legislation in Italy and criticise the existing legislation in light of the Sustainable Development Principles(SDGs). Especially now, given that the bill amending Articles 9 and 41 of the constitution has been approved by the Italian Parliament, the Pigouvian approach is nothing but a must for taxation of waste in Italy.
The sustainable development and the polluter pays principles have been introduced in Italy thanks to ex. Article 11 of the law 130/1999. Even though these principles have begun to become an integral part of the Italian Legal System and judicial interpretations, this is still not the case for the taxation of waste.

Currently, the main waste tax for municipal solid waste(MSW) in Italy is the Tari which is a very important source of finance for municipalities. This tax is mainly calculated based on the size of the houses and the number of persons living in them; therefore, it is argued that the Tari neither provides incentives for those who reduce their waste, nor disincentivises those who pollute more by generating excessive waste. As a solution, pay-as-you-throw schemes and the polluter pays principle should be taken into account. From the tax law perspective, this can be possible thanks to the Pigouvian waste taxes. For this reason, Italian Legal Framework on waste tax should be updated.

Keywords: Italian Waste Tax (the Tari), Sustainable Development, Pigouvian Taxes, PAYT(Pay-as-you-throw)

JEL Classification: K34, K32