Spending cuts czar discusses possible savings with Renzi

Government aims to cover new tax cuts with budget savings

(ANSA) - Rome, April 7 - Italian Premier Matteo Renzi on Monday was huddled with spending review chief Carlo Cottarelli and economist MP Yoram Gutgeld to debate possible budget measures on the eve of presenting a tax and spending bill to cabinet. Renzi was also meeting with Economy Minister Pier Carlo Padoan to go over the budget bill set to be approved by the executive on Tuesday. The government is hammering out new spending cuts to cover tax cuts that are aimed at stimulating economic growth in Italy.

The government aims to reduce a regional business tax called the Irap, but has yet to determine by how much. The unpopular tax on gross revenues will take a 5%-10% bite out of turnovers this year. The government is also deciding on personal income tax deductions and the premier has pledged 10 billion euros will be cut from the tax bill of low income earners.

Renzi said in an interview that he thought Europe overall should be carrying out a similar budget review exercise. "Europe must also carry out a spending review," Renzi said in interview with public broadcaster Rai television.