New Italian PM Unveils Deficit-Cutting Plans Amid Protests

Posted November 17th, 2011 at 3:40 pm (UTC-5)
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Italy's new prime minister, Mario Monti, has unveiled a major austerity program, saying Italy's ability to resolve its debt crisis is critical to the future of the euro.

Mr. Monti addressed the upper house of parliament, the Senate, ahead of a confidence vote on Thursday. The lower house is scheduled to cast its votes on Friday.

The prime minister said he may bring back an unpopular property tax that was eliminated by his predecessor, Silvio Berlusconi, who resigned last Saturday.

Mr. Monti also said he will consider overhauling the entire tax system to reduce taxes on employers and provide tax breaks for hiring women. He said shifting the tax burden from employers to consumers will encourage growth.

Mr. Monti, an economics professor and former European Union commissioner, was sworn in on Wednesday along with his new government. He said he will seek “sacrifices” from Italians to resolve the country's economic problems and get it moving forward again.

Meanwhile, thousands of students across Italy are protesting the country's new government. Students in Milan, Rome and other cities clashed with police — protesting against government budget cuts and a lack of jobs.

Strikes by transportation workers also brought trains and buses to a stop in Rome on Thursday.

European Union leaders have been pressuring Italy to cut public spending to avoid becoming the latest eurozone member to request a bailout. EU officials worry that the Italian economy is too big to be rescued, and they fear its demise would be a major blow to the common European currency, the euro.