Bloomberg News

Monti, Berlusconi Spar on Taxes in Weekend Media Barrage

January 06, 2013

Italian Prime Minister Mario Monti and one of his challengers in next month’s elections, Silvio Berlusconi, sparred over the government’s unpopular property tax and economic policy in a weekend media blitz.

Monti signaled that the property tax known as IMU could be restructured, while Berlusconi renewed a pledge to eliminate the levy on the purchase of a first home, a move that would mean a revenue shortfall of more than 3 billion euros ($3.9 billion).

Monti indicated that cutting income tax and suspending a planned increase in the value-added tax would be possible, although those moves would have to be offset by spending cuts.

Politicians “must avoid making easy promises to the public,” he said in an interview yesterday with SKYTG24.

Berlusconi, who had supported Monti’s 13-month-old government of non-politicians, has been stepping up his attacks against Monti, yesterday telling newspaper Giornale di Umbria it is “immoral’ for Monti to run in the elections after leading a government of non-politicians. Monti was appointed prime minister in November 2011, when Berlusconi’s government unraveled and he resigned.

Monti is forming a list of candidates to back his economic overhauls, which are aimed at taming public finances and making Italy more competitive. Monti has allied with centrist parties that back his agenda, including Union of Centrists and a new movement started by Ferrari SpA Chairman Luca Cordero di Montezmolo.

Monti ‘‘has chosen traveling partners that aren’t reliable, and the list that he is creating will just deliver votes to the left,” Berlusconi told Giornale di Umbria.

Monti Media Appearances

Monti began media appearances on the evening of Jan. 4 with a press conference to unveil the new logo for his political list in the Chamber of Deputies. He followed that night with a near- hour-long appearance on the “Otto e Mezzo” talk show on station La7.

On Jan. 5, he answered 140 questions from voters in a live Twitter chat. Berlusconi countered with a simultaneous appearance on Corriere della Sera’s Internet television service and was interviewed on local television stations Rete Italia, Gold TV, Canale Italia and Espansione TV.

Berlusconi’s frequent media appearances have raised protests from other parties because Italian law requires that all candidates have equal access to television time during the campaign period. The three-time premier has been a regular guest on television and radio programs since withdrawing his support for Monti’s government last month, an action that prompted Monti to announce his intention to resign.

Gains in Polls

The coverage may be helping Berlusconi in the polls. His People of Liberty Party, along with its potential allies, the Northern League, and some smaller parties would win 28.8 percent of the vote if elections were held today, according to a poll by Tecne for SKYTG24. That’s more than twice the 14.3 percent for Monti and his allies, the poll said.

Berlusconi said that his support has climbed by 10 points since he began campaigning and that he’s confident support for the PDL and its allies will reach 40 percent by the Feb. 24-25 elections. Still, the Northern League, Berlusconi’s ally in his three election victories, has refused to join forces with the PDL if Berlusconi is that party’s candidate for prime minister.

It would be “suicide” for the League to run in the elections on its own, Berlusconi told Espansione television. He said the PDL was close to an agreement to revive its alliance with League.

Both Monti and his allies and Berlusconi’s forces trail the Democratic Party, led by Pier Luigi Bersani, which has the backing of more than 39.9 percent, according to Tecne.

With the elections six weeks from now, Monti is running out of time to close the gap with the Democrats. Still, his support may prove critical to the formation of the next government. Italy’s election law makes it difficult to win a majority in the Senate, and Bersani may need Monti’s backing to govern.

While Monti has maintained that it’s critical for the next government to continue his economic overhaul, he said on “Otto e Mezzo” that he wouldn’t accept a position of finance minister in the next administration.

To contact the reporter on this story: Andrew Davis in Rome at abdavis@bloomberg.net

To contact the editor responsible for this story: Tim Quinson at tquinson@bloomberg.net


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