Martedì, 25 Settembre 2018

Government caves in over budget


Rome, November 1 - Premier Mario Monti's government
has agreed to a substantial rewrite of the budget measures in
its so-called Stability Law bill in the face of opposition from
the main parties supporting the emergency administration.
The biggest change is that a 1% cut in the two lower bands
of income tax is to be scrapped to avoid an increase that would
have taken the second-lowest bracket of VAT up from 10% to 11%
next year.
However, a 1% increase in the top band of VAT, taking it up
to 21%, remains.
The government will also scrap reductions in tax
deductions for the current tax year, which would effectively
have made this a retroactive measure, saying the reductions will
now come into force in 2013.
Business associations and consumers have joined many
politicians in raised concerns that increasing VAT will further
depress the Italian economy after austerity measures Monti's
government passed last year deepened the recession Italy is
Italian consumer spending and industrial production levels
have been falling for months and Istat on Wednesday said that
unemployment reached 10.8% in September, its highest level since
2004. The national statistics agency said youth unemployment
levels were particularly alarming, with 35.1% of
15-to-24-year-olds jobless.
The government said earlier this month after presenting the
bill, which also features a series of cuts hitting sectors
including health and eduction, that it was willing to accept
some amendments during its passage through parliament as long as
the bottom line is not affected.
Industry Minister Corrado Passera said the deal with the
parties had not "turned upside down" the budget because "the
philosophy and analysis at the basis of it are maintained".
Ex-premier Silvio Berlusconi's People of Freedom (PdL)
party and the main centre-left Democratic Party (PD) said the
agreement on changes to the bill was a step forward.
"The PdL is totally satisfied with the results achieved (to
amend the Stability Law) in the parliamentary budget committee,
where most of our proposals have been accepted by the
government," said PdL Secretary Angelino Alfano.
Around 1,600 amendments were presented to the Stability Law
bill on Thursday, although these were presented by individual
MPs rather than being changes sanctioned by the government in
the light of the deal with the parties.

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