Italian government approves tax-cut budget

Italian government approves tax-cut budget
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The Italian government has approved next year’s budget with tax cuts shifting the burden to government bureaucracy from taxpayers in a bid to spark the stagnant economy.

Prime Minister Enrico Letta is relying on 3.5 billion euros of spending reductions to meet 2014 deficit targets.

Central government will bear 2.5 billion euros of the cuts, regional administrations 1 billion euros.

The labour-tax reduction will give an extra 1.5 billion euros to workers next year. Companies will get tax breaks of 5.6 billion euros through to 2016.

It is evidence of a shift from a focus on taxation to spending cuts said one analyst.

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