Chiara Scotti: Financial and tax regulation for the digital era - charting the path forward

Speech by Ms Chiara Scotti, Deputy Governor of the Bank of Italy, at the conference "The interplay between tax and financial regulation in a new digital environment", Rome, 7 April 2025.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Central bank speech  | 
09 April 2025
by Chiara Scotti
PDF full text
(211kb)
  |  9 pages

Good morning, ladies and gentlemen. I would like to welcome you all to Banca d'Italia and thank the Global Tax Policy Center at the Institute for Austrian and International Tax Law of Vienna University for jointly organizing this conference to discuss the vital link between financial regulation and taxation in the new digital world.

I will focus on three key challenges faced by financial regulators and tax policymakers, highlighting potential synergies, open issues and possible solutions.

These are, first, the definition of general principles that financial regulation and taxation should follow to achieve their goals in dealing with the new digital environment. Second, the delineation of the scope of financial regulation and tax policies, with emphasis on their coherence and consistency in order to ensure they are clearly understood by market operators, investors and customers, and can be effectively enforced. Third, the need for international cooperation and cross-sectoral coordination to leverage potential synergies and to avoid regulatory and tax arbitrage as well as other unintended consequences and unnecessary complexity.

I will argue that we need an innovative and proactive approach that is able to intercept and pivot technological and market developments as they occur, while addressing the unique challenges and risks of digital payments and financial services. This will help regulators develop forward-looking supervisory measures that balance financial stability with innovation and efficiency, while enhancing the effective management of money laundering risks and the proper fulfilment of tax obligations. In doing so, rulemaking should seek to be simple and plain.