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INSIGHT-Switzerland looks good to Italians
By Silvia Aloisi and Martin de Sa'Pinto
MILAN/LUGANO Nov 23 (Reuters) - Marco, a 31-year-old from southern Italy, has never set foot in neighbouring Switzerland. Now he's thinking of moving his family's cheese-making business there.
Growing fear about the impact of the eurozone crisis in Italy is making Switzerland -- traditional banking safe haven for the world's wealthy -- increasingly attractive to ordinary men and women nervous about the impact of austerity measures and even the possible collapse of the eurozone.
Italians are among the keenest.
"I am worried for my future, I think there'll be a lot of blood and tears as the new government demands sacrifices from everybody," mozzarella maker Marco told Reuters.
"The Swiss franc right now seems quite safe compared to the euro, and going to sell my cheese over the border makes sense. I am not interested in becoming a billionaire, I just want some peace of mind."
Gianluca Marano, head of an Swiss-based consultancy for businesses wanting to open a branch in Switzerland or move there altogether, said he had been inundated with requests from Italy over the past six months. Marco is one of his clients.
"With Italian banks gradually turning the credit tap off, companies are looking for alternative solutions, transferring part or all of their business here to keep having access to liquidity," he said.
Italy installed a new government, led by former EU Commissioner Mario Monti, earlier this month. It now must implement stringent austerity measures to slash the country's debts, raising fears of a possible wealth tax.
That, coupled with nervousness about the health of banks and even the implosion of the euro, is driving ordinary Italians to look to their northern neighbour as a harbour for their assets.
Contribuenti.it, a tax payers' association, said that according to their latest data the number of Italians seeking to open a bank account or a safe deposit in Switzerland or Luxembourg had increased by 7 percent since June.
"It started when the Berlusconi government (Monti's predecessor) began talking about austerity measures. What we are seeing is that, while before it was only the very rich who crossed the border to stash their cash away, now middle-class folk do it too," said Vittorio Carlomagno, association chairman.
"Over the past few weeks, our telephone lines have been flooded with calls by citizens worried about a wealth tax or a one-off measure on current accounts, like the one in 1992. People want to know what they should do with their money and whether they should withdraw their savings from the bank."
A SWISS HOME
A Swiss tax adviser has also noticed a rise in the number of Italians ready to pack up their bags and move to Switzerland.
"It's pensioners or businessmen who want to get Swiss residency and move their operations there. I have had more requests to this effect since the summer than over the past 10 years."
In Lugano, a Swiss lakeside town close to the Italian border, bankers report a shortage of deposit boxes -- a favourite way for investors to hide their money from the taxman.
What is interesting about the current crisis, though, is that businesses and individuals are not simply trying to find ways to hide their money to avoid tax.
"The transfers are being made in the light of day, either to ad-hoc trust companies or in any case by declaring them in the tax returns," said one Swiss banker.
Massimiliano Brasile, an Italian engineer with a hobby for personal finance who in 2008 set up www.piccolorisparmio.eu, a blog specialising in savings and small investment opportunities, said page hits had trebled since July and most newcomers wanted to know how to open a bank account in Switzerland.
"People are worried, they fear an Argentina-style default and they are worried about their hard-earned savings. People are asking for common-sense advice and want to operate legally."
CALM, BUT WARY
Italians are not panicking. There are no queues outside its banks, no caravans of cars transporting pensioners wielding suitcases of cash over the border. But they are nervous.
Travellers report that border police have stepped up checks
-- but authorities insist this is to deal with illegal -- but authorities insist this is to deal with illegal immigration not money movements.
"The cases of smuggling cash over the border are rare and in any case limited to small amounts," said one Italian banker.
"But what we are seeing is a rise in the number of private citizens who, fearing a possible freeze on the movement of capitals, are opening deposits through trust companies based in London and Switzerland, moving liquidity to non-euro assets so they can have their funds available in case of need and avoid the consequences of a feared exit of Italy from the euro."
Bruno Consalter, founder of Treviso-based accounting service Consadvice, said many people in Italy were naturally mistrustful of authorities. Tax evasion is rife, standing at an estimated 120 billion euros per year.
"People have never trusted the government and now they no longer trust the banking system. Many are shifting their money out, some are hiding it under the bed, some are buying tangible goods like land and gold when they can."
A survey of 20,000 Italians by financial website SuperMoney this month found that 35.4 percent of those interviewed did not trust Italian banks any longer and did not feel safe leaving their money in the bank. Fifty-six percent said they did not trust their own bank any more.
Memories are still vivid in Italy of a 1992 emergency decree by Prime Minister Giuliano Amato that imposed a retroactive 0.6 percent levy on all bank accounts and deposits as of two days earlier. This was part of a "blood and tears" austerity package as the lira was under heavy market attack.
"It happened overnight, with no warning. You woke up in the morning and your money was gone," said Lorenzo Arrighi, a 75 year old pensioner. "This is why people are so worried now."
There are some nascent signs of optimism, however.
Carlo Cominassi, an engineer at Milan-based SPM consulting, is one of many Italian savers preparing to get behind a campaign to buy Italian bonds.
"People still believe in Italy's future," he told Reuters. "I'll be buying".
(Writing by Jodie Ginsberg; Additional reporting by Cristina Carlevaro, Maria Pia Quaglia and Paola Arosio in Milan)
((email@example.com)(+44 207 542 9053)(Reuters Messaging: Twitter: @jodieginsberg)) Keywords: ITALY SWITZERLAND/
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