Posted by WARREN MOSLER on January 28th, 2013
The headline is promising but the details don’t read at all well.
Italy needs aggregate demand/spending/sales/ouput/employment. Cutting corporate taxes does precious little of that, especially over 5 years beginning 2014. And tax cuts ‘paid for’ by spending cuts tend to reduce demand overall as well, as does fighting tax evasion. And there’s nothing he can do about bond yields.
And I doubt his opposition is offering anything better.
As the gag stated, the food was bad and the portions were small.
Monti Proposes More Than EU13.5 Billion in New Tax Breaks, Cuts
January 27 (Bloomberg) — Italian Prime Minister Mario Monti said that he plans tax breaks and reductions worth more than EU13b if hes elected to a second term in February. Monti spoke in an interview on La7 Television. Monti proposes cutting corporate taxes after 2014;Monti sees EU11.5b reduction in corporate taxes over 5-yr period; Monti says he plans tax breaks for first-home owners, families with children worth EU2b; Monti says he will revamp IMU property tax from this year; Monti says he will try to cut income tax rates after 2014; Tax cuts can be paid for through cutting spending, fightingtax evasion and keeping bond yields down.