Forza Italia's Cabinet meeting: "Taxing buybacks makes no sense, for four reasons."

Forza Italia reiterates its opposition to new taxes, doing so on the day the Council of Ministers is considering a new tax on buybacks. "Buybacks—the repurchase of own shares—are an operation undertaken by healthy companies in all major countries with market economies," Forza Italia's economics director, Maurizio Casasco , emphasizes to Affaritaliani . For the shareholder, it is typically a complementary transaction (but can also be an alternative) to the dividend. Taxation applies to capital gains (assuming there are any), at 26% in Italy and therefore is equivalent to that applied to the dividend or better if there is no capital gain. For the market, it is a very attractive transaction: when the dividend is paid, the share price decreases proportionally (ex-dividend price) because the company's wealth decreases by the same amount. When a buyback is announced, however, the share price increases: why? For two reasons: 1. By decreasing the number of shares, earnings per share (the intrinsic value) increase in a mathematically proportional manner. 2. ⁠The return to the shareholder (dividend + buyback) increases and the share price (always benchmarked against the bond yield) appreciates accordingly.

Casasco explains: " Taxing buybacks makes no sense, for four reasons :

1. It penalizes savers who have invested in stocks, a rare commodity in the small Italian stock market, and discourages future investment, precisely at a time when more risk capital is needed to finance growth and technological transition.

2. ⁠The value and therefore the attractiveness of virtuous companies that have announced buybacks is RETROACTIVELY penalized.

3. ⁠International institutional investors (which we so desperately need to support our development) will be discouraged and driven away. They would once again view Italy as an unreliable country—despite the government's great merit in ensuring stability, employment, a rating, and extraordinary spreads compared to Germany and France—because it is departing from international standards, even retroactively. 4. ⁠Pension funds and therefore, indirectly, citizens, are penalized, thereby incentivizing foreign investment (the opposite of what is desirable and what the government is verbally calling for, even with strong measures such as the use of the golden power).

And finally, as regards the banks, the Government recently signed an agreement with the ABI, which, in reality, has been denied ", concludes the Azzurri economic manager.