Italian Talk of Tax Cuts Risks Upsetting Europe’s Fund Plans
- EU aiming to agree on massive stimulus package by next month
- Critics say Italy can’t be trusted to spend money responsibly
Venetian tourist souvenirs sit on display in a shop window near the Rialto bridge in Venice.
Photographer: Andrea Merola/BloombergItaly’s announcement that it’s considering a cut in sales tax will fuel doubts about the country’s commitment to economic reform just at the moment when its European Union allies are trying to persuade skeptics that the country can be trusted with a massive stimulus package.
EU leaders last week held their first talks over a 750 billion-euro ($840 billion) recovery fund, with Rome set to receive 82 billion euros in emergency grants and up to 91 billion euros in low-interest loans under a proposal drawn up by the European Commission. Germany and France are pushing for the plan, which needs the backing of all 27 member states, to be approved next month.