Italy’s prime minister Mario Monti is to give low-earners a cut in income tax.
It is a rare boost for struggling households in the eurozone’s third largest economy that has been in recession for a year.
The unexpected tax cut was balanced with a rise in VAT and a series of spending cuts in a combined package worth 11.6 billion euros in all.
Monti said: “We wanted to give a clear signal that when there are good signs of stabilisation in the national budget you can afford some moderate relief on income tax.”
Monti added that the tax break shows that his severe austerity measures were beginning to bear fruit.
Parliamentary elections are due in Italy next year.
Wires > Business
- 09:28 CET Poland to appeal court decision not to extradite Polanski to U.S.
- 09:27 CET Two with Thai army links found guilty of attack on gold mine…
- 09:06 CET Japan erupts in anger over boy abandoned in forest after being…
- 09:00 CET Exclusive: Westinghouse to get new site for Indian nuclear plant -…
- 08:51 CET Spanish police arrest man accused of promoting Islamist militancy
- 08:42 CET Death toll from Russian air strikes in Idlib climbs to 23 – monitor
- 08:32 CET Hamas executes three convicted Palestinians in Gaza
- 08:24 CET Huge fire breaks out in Indian arms depot, 17 feared dead