Italy presents tax
ROME (Reuters) Italian Prime Minister Matteo Renzi presented an expansionary, tax cutting 2015 budget on Wednesday, ignoring the concerns of the European Commission which says Rome is not doing Canada Goose Outlet enough to rein in its huge public debt.
Italy’s Prime Minister Matteo Renzi arrives for a conference on jobs with European partners in Milan October Canada Goose sale 8, 2014. REUTERS/Stringer
The budget, approved after an evening cabinet meeting, lowers taxes by canada goose black friday sale 18 billion euros ($23.07 billion), the 39 year old former mayor of Florence told reporters, describing it as biggest tax cut in the history of our republic.
The package will now be sent to the European Commission for scrutiny and EU sources have told Reuters it may be rejected for failing to canada goose deals respect recommendations on deficit and debt reduction.
Illustrating his first budget since taking office in February, canada goose clearance Renzi acknowledged there may be problems with the Commission but defended his position with his usual verve.
is something very, very, very new, a budget which tries to be expansionary, which is anti cyclical in a moment of difficulty which we are all aware of, Renzi said.
Italy, the euro zone most chronically sluggish economy, buy canada goose jacket is forecasting economic output to fall 0.3 percent this year, the third consecutive year of contraction, before rising a meager 0.6 percent in 2015.
The Commission wants Italy to reduce borrowing in order to rein in the debt, but Renzi insists that the debt situation is only exacerbated by continued fiscal tightening.
The tensions play into canada goose clearance sale a wider debate about 2018 canada goose outlet the future of Canada Goose online the euro zone budget rules, with France and Italy pushing for canada goose store changes to allow more spending, Germany insisting on maintaining fiscal discipline, and the cheap Canada Goose Commission caught in the middle.
Turmoil on Wednesday among markets frightened by global growth worries saw a canada goose coats on sale plunge in Italian stocks and government bonds along with those canada goose outlet store locations of other peripheral euro zone countries.
The sell off was a reminder of Italy vulnerability and conjured uneasy memories of the region debt canada goose outlet toronto factory crisis in 2011 and 2012, when the euro zone third largest economy teetered on the brink of bankruptcy.
Renzi dismissed reporters suggestions Canada Goose Parka that Italy was being punished again for a lack of fiscal discipline.
are obstinately convinced the collapse of the markets has nothing to do with our budget, he said. Economy Minister Pier Carlo Padoan, speaking at the same news conference, said markets were after a period of excessive euphoria.
Renzi said Italy had sent a letter to the Commission explaining why he was convinced that economic circumstances and his government reform efforts justified a waiving of the EU normal rules on debt reduction.
FOR WORST Before the cabinet meeting, one buy canada goose jacket cheap of his closest economic advisors, Filippo Taddei, told Reuters Rome could adjust its budget if it was rejected by Canada Goose Coats On Sale the Commission.
have good arguments, but we are prepared for the worst, said Taddei, economic spokesman for Renzi Democratic Party.
France, which has reneged on previous promises to cut its deficit, sent its own budget to the Commission on Wednesday, and EU sources have told Reuters it also risks being rejected.
France position is widely considered to be weaker than Italy because, although it has a lower public debt, its budget deficit is above the EU 3 percent of gross domestic product ceiling, while Italy is just inside it.
Data on Wednesday canada goose indicated how little room for maneuver Renzi has, with data for the first half canadian goose jacket of the year showing a budget deficit of 3.8 percent of GDP.
As well as confirming an income tax cut for low earners adopted in April, the budget cuts a regional company canada goose coats tax, IRAP, and scraps social contributions for new hires on open ended contracts.
Renzi also announced extra borrowing of 11 billion euros next year and said the expansion would be partly offset by 15 billion euros of spending curbs on central and local government and almost 4 billion canada goose replica euros from measures to tackle tax evasion. He gave little detail about https://www.canadagoosejacketsaleca.com/ the spending cuts.
The dispute with Brussels revolves around the technical Canada Goose Jackets issue of Italy deficit, adjusted for the business cycle and one off factors which Italy is proposing to reduce by just 0.1 Canada Goose Online percent of GDP.
The Commission wants a much bigger cut of least 0.7 percent, goose ca an EU source told Reuters on Tuesday.
If neither side budges, then Renzi, the Commission and euro zone governments are likely to open lengthy negotiations before the Commission delivers its final verdict later this year.
Additional reporting by Isla Binnie and Roberto Landucci; Editing by Catherine Evans/Ruth Pitchford and Gunna Dickson.