No economist here, so this may be flawed, but:
- increase VAT from 21% to 30% = EUR 54bn more tax revenues
- kill IRAP = EUR 38bn less tax revenues
- kill Provinces, keeping employees on payroll = EUR 5.3 saving
- raise retirement age to 65 years for everybody = saving gradually increasing until 2018 to EUR 7bn
This would net out to around EUR25bn to cut taxes; for example we could move to a dual bracket personal income tax of 19% (up to EUR 100k) and 28% (above 100k).
- massive reallocation of tax revenues from labor to products which is inherently fairer as it is paid by everybody (including evaders)
- significant personal income tax cut which would pump in the real economy about EUR 25bn in additional disposable income (more sales mean more VAT, and fatter corporate profits mean more income tax, both not accounted for here)
- stimulus to european manufacturing (only EU companies can reclaim VAT)
- even out generation gap, eliminating the IRAP wedge and raising retirement age
mr. Monti, you can have the above under CC Attribution License.