- Italy faces a fresh budget fight just months after ending a near six-month saga surrounding spending, after media reports in the country suggested the coalition government could move to raise taxes.
- Government officials moved to squash the rumors. Finance Minister Giovanni Tria described those responsible for reports of higher taxes as “follies and speculations.”
- “They’re all crazy, not only because we aren’t talking about it, but because it would be wrong to so this from the standpoint of economic policy,” Tria said.
Italy faces a fresh budget row just months after ending a near six-month saga surrounding spending, after media reports in the country suggested the coalition government could move to raise taxes.
The purported move, which would see value-added-tax increased to bring in more government revenue, would be hugely controversial given that the country slipped into a recession at the end of last year.
Output in Europe’s fourth-largest economy contracted by 0.2% in the fourth quarter, on the heels of a 0.1% drop in the quarter before that.
Any increase would be made even more divisive by the fact that both parties in the coalition — the Five Star Movement and the Northern League — campaigned on platforms of keep taxation levels flat for the majority of Italians at last year’s elections.
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