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Brunetta says government will fall if VAT rises

PdL House leader says finance minister has 'duty' to lower taxes

20 September, 12:26
Brunetta says government will fall if VAT rises (ANSA) - Rome, September 20 - The centre-right People of Freedom (PdL) party of ex-premier Silvio Berlusconi, newly rebranded under its original name Forza Italia, again threatened on Friday to bring down Italy's fragile coalition government if it fails to avert a 1% rise in the top band of VAT.

PdL House whip Renato Brunetta said that the finance minister "has a duty" to find the money to stop VAT rising from 21% to 22% even though Fabrizio Saccomanni has said that to do so could create too large a deficit.

"Saccomanni has a duty to ...(meet) the commitments made by the government and for which the government has gained the trust," of other parties in the coalition, Brunetta - architect of PdL tax initiatives - told Radio Anch'io. "I do not like Saccomanni's diktats," he said, adding that the minister's Democrat Party (PD) pledged to find the money to avoid the VAT increase but has since said there isn't enough cash in the kitty to do so without breaching EU deficit limits.

Therefore, "in October if they are unable to avoid the VAT increase as we are committed, the government falls". One day earlier, European Commission sources warned that Italy will need to take corrective budget measures if the government's updated economic blueprint due on Friday forecasts a deficit-to-GDP ratio above the 3% threshold allowed by the European Union.