Italy's 2nd austerity package criticized
Source: Agencies |
August 15, 2011, Monday
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Print Edition
Print Edition
ITALY'S second austerity package in less than a month met with a chorus of criticism a day after becoming law, with the largest union federation threatening a general strike over the "injustice" of the measures.
President Giorgio Napolitano last Saturday signed the emergency decree introducing sweeping austerity measures to cut the fiscal deficit by some 45.5 billion euros (US$64.7 billion) and balance the budget in 2013, a year ahead of its previous schedule.
"A missed opportunity," was the comment by the chief economist of the Paris-based Organization for Economic Co-operation and Development, Pier Carlo Padoan, in the La Stampa newspaper yesterday.
Padoan said the plan was positive in the pledge to bring forward the balanced budget but it lacked measures to boost growth and tackle tax evasion. Employers' lobby Confindustria estimates Italy's tax evasion totals 120 billion euros.
CGIL union confederation leader Susanna Camusso told la Repubblica the package "hits only those who already pay their taxes," adding that the date of a general strike would be decided at an emergency union meeting on August 23.
The austerity plan sets a "solidarity tax" on those earning more than 90,000 euros per year, to be levied for three years.
Economists, unionists and business leaders agreed a tax on wealth rather than on labor income would have been better because it would have targeted tax evaders who do not declare their real income but often own large assets.
Ferrari Chairman Luca Cordero di Montezemolo told Corriere della Sera newspaper the solidarity tax was "a scandal."
"It's one thing to ask for a solidarity contribution from me or (media tycoon and Prime Minister Silvio) Berlusconi, but it's different to hit an executive supporting his family," he said.
Newspaper editorial comments were largely negative, with former European Commissioner Mario Monti telling Corriere della Sera the package lacked fairness, weighed too heavily on the middle classes and did too little to help growth.
President Giorgio Napolitano last Saturday signed the emergency decree introducing sweeping austerity measures to cut the fiscal deficit by some 45.5 billion euros (US$64.7 billion) and balance the budget in 2013, a year ahead of its previous schedule.
"A missed opportunity," was the comment by the chief economist of the Paris-based Organization for Economic Co-operation and Development, Pier Carlo Padoan, in the La Stampa newspaper yesterday.
Padoan said the plan was positive in the pledge to bring forward the balanced budget but it lacked measures to boost growth and tackle tax evasion. Employers' lobby Confindustria estimates Italy's tax evasion totals 120 billion euros.
CGIL union confederation leader Susanna Camusso told la Repubblica the package "hits only those who already pay their taxes," adding that the date of a general strike would be decided at an emergency union meeting on August 23.
The austerity plan sets a "solidarity tax" on those earning more than 90,000 euros per year, to be levied for three years.
Economists, unionists and business leaders agreed a tax on wealth rather than on labor income would have been better because it would have targeted tax evaders who do not declare their real income but often own large assets.
Ferrari Chairman Luca Cordero di Montezemolo told Corriere della Sera newspaper the solidarity tax was "a scandal."
"It's one thing to ask for a solidarity contribution from me or (media tycoon and Prime Minister Silvio) Berlusconi, but it's different to hit an executive supporting his family," he said.
Newspaper editorial comments were largely negative, with former European Commissioner Mario Monti telling Corriere della Sera the package lacked fairness, weighed too heavily on the middle classes and did too little to help growth.
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