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Berlusconi faces test over tax powers
Rome, Feb 3 (Agencies):
Published on 3 Feb. 2011 11:12 PM IST
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A parliamentary committee is due to give a ruling on Thursday that could determine the fate of embattled Italian Prime Minister Silvio Berlusconi’s fragile centre-right coalition.
The committee will decide on a package of local tax reforms which Berlusconi’s Northern League partners have promised to their supporters in the prosperous cities and regions of the north and declared a precondition for remaining in government.
Negotiations went on late into Wednesday but the result is expected to be evenly balanced and may result in a split vote between the 30 members of the special committee of both houses of parliament.Umberto Bossi, the bluntly spoken leader of the Northern League, said if the measures, which give more tax and spend powers to local governments, are not approved, the party should push for an election straight away.
“We have to get federalism or everything goes,” he was quoted as saying by the daily La Stampa on Thursday after a late night meeting with Berlusconi.
“Either we get a political majority for federalism in the commission or we go to elections,” he said.
How serious his threat is remains to be seen but if the opposition succeeds in blocking the “fiscal federalism” package in the commission it can be brought to a full vote in the lower house where it is more likely to pass.
Any serious problems would be a blow to the government, which is hobbled by last year’s split between Berlusconi and his former ally Gianfranco Fini and reeling from the sex scandal that has ensnared the 74-year-old premier.
A vote is expected in the early afternoon.
Berlusconi has resisted calls to resign over the scandal that has dominated headlines and made a household name of “Ruby”, the teenaged nightclub dancer he is alleged to have paid for sex while she was under the legal age.
He denies the accusations but the affair has largely prevented Berlusconi winning back control of the political agenda since scraping through a no-confidence vote on Dec. 14.
He has promised a programme of measures to cut red tape and boost growth but details remain sketchy and the federalism plan will be a test of the government’s ability to achieve its policy goals.
The package, which includes a new tax on second houses, new rules on rental income and a levy on hotel bills, has been revised numerous times and much of its impact will not be felt for several years.

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