Berlusconi will refund property tax

2013-02-03 22:43

Rome - Silvio Berlusconi on Sunday pledged an immediate refund of the property tax that was introduced by the government of his successor Prime Minister Mario Monti if Italy's conservative coalition wins elections this month.

The tax has proven "the most foolish and odious act of the technocratic government, an act that started the crisis," Berlusconi said at a rally in Milan.

Monti introduced the IMU levy on primary residences in late 2011 in a bid to quickly raise cash amid the financial crisis that had forced Berlusconi to step down.

At the time the measure was supported by Berlusconi's People of Freedom party as well as centrist and centre-left forces that also backed Monti. It is deeply unpopular among Italians.

Berlusconi said taxpayers would be reimbursed the estimated €4bn in property tax for 2012 as a "a peace offer from the state and tax authorities towards our households, a symbolic act to turn over a page and restore citizens' faith in the state".

Berlusconi also promised to "gradually reduce and eliminate" an existing regional tax on businesses within five years, cut income tax rates after three years and scrap a planned increase in value added tax.

The measures would be financed through €80bn in state spending cuts over five years, a deal with Switzerland to tax Italians with bank accounts there and hikes in tobacco and gambling levies.

"Even an imbecile can invent new taxes and force them upon citizens; only those who are intelligent can cut spending," Berlusconi said.

The three-time premier and media mogul has always centred his election campaigns on tax cuts. He says he does not aim to lead the government and would rather serve as economics and industrial development minister after the general election on the 24-25 February election.

Hollow promises

After trailing badly at the start of the campaign in December, Berlusconi has closed the gap with centre-left rivals. The most favourable surveys say he is five points behind, compared to 15 in early January.

"We are close to a historic result. In other words, we can win," Berlusconi said.

The Democratic Party, which is ahead in the polls, dismissed Berlusconi's proposals as unrealistic and said it would waive the tax only on inexpensive properties.

"He is trying to be forgiven for the damage he has done to Italians," PD economy spokesperson Stefano Fassina said.

Monti attacked Berlusconi for having "never kept a promise... He is trying a fourth time. Italians have a good memory." But the outgoing premier, whose centrist camp is battling for third place in the polls, has also pledged a "timely and gradual tax reduction."

Berlusconi resigned in November 2011 as the financial crisis took hold and amid a string of scandals that have led to one conviction for tax fraud and charges of abuse of power and paying for sex with an under age dancer.