Rising VAT Numbers Contrasts with Declining Artisan Count

Rising VAT Numbers Contrasts with Declining Artisan Count

In the aftermath of the Covid pandemic in 2020, there has been a resurgence in the number of VAT registrations. Today, the total number of VAT members has surpassed the 5 million mark. As of December 31st, we tallied up 5,045,000 self-employed individuals. While there has been a slight increase in this number compared to four years ago, it is still a long way off from the 6.2 million recorded in early 2004. This information was provided by the CGIA Research Office. However, the world of self-employment isn’t flourishing across all sectors. In fact, numerous professions are grappling with significant challenges. The number of ‘traditional’ self-employed workers, such as artisans, small traders, and farmers, is dwindling. Conversely, there is an expansion in VAT registrations without a specific professional association or register.


The unregulated professions category includes roles such as web designers, social media managers, trainers, investment consultants, advertisers, business consultants, IT consultants, utility managers, sociologists, and condominium administrators. These VAT-registered individuals, along with their micro-businesses and employees, form a social group of over 6 million people. Pre-Covid, this group contributed almost 200 billion to the GDP and has become a crucial part of our economic system over the past 40 years, particularly in the Northeast.


The rise in self-employment over the past three years can largely be attributed to the economic recovery that occurred post-Covid. With the GDP reaching impressive growth levels in 2021 and 2022, employment—particularly self-employment—saw a boost. The implementation of a flat-rate scheme for self-employed businesses earning less than 85,000 euros has made running a business less taxing. The numerical growth in this sector may also be linked to an increase in ‘fake’ VAT registrations. The recent surge in smart smoking could have led to an increase in “fake” VAT registrations, although it’s estimated that there are only about 500 thousand of these currently.


Interestingly, this is a number we reached nearly two decades ago. In the past year, regions such as Molise (+8.4 percent), Liguria (+8.2 percent), Calabria, and Emilia Romagna (both with +5.6 percent) have seen the most significant increases. Conversely, Abruzzo (-4.9 percent), Umbria (-5.6 percent), Trentino Alto Adige (-8.4 percent), and Marche (-10.1 percent) have experienced the most notable declines. While there has been an overall increase in self-employment in recent years, the number of individuals involved in traditional self-employment has consistently decreased.


When comparing data from 2014 and 2022, the total number of artisans, traders, and farmers fell by 495 thousand. Farmers saw a decrease of 33,500 units (-7.5%), traders declined by 203,000 (-9.7%), and artisans dropped by nearly 258,500 (-15.2%). These figures include the INPS positions of company owners, partners, and family collaborators.