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Silvio Berlusconi’s pledge to hand back tax cash

Silvio Berlusconi made his tax rebate pledge at an event in Milan yesterday. Picture: Antonio Calanni/AP

Silvio Berlusconi made his tax rebate pledge at an event in Milan yesterday. Picture: Antonio Calanni/AP

  • by TOM KINGTON
 

AS HE edges up in polls ahead of Italy’s elections later this month, Silvio Berlusconi has made what he hopes will be a winning campaign pledge: the handing back, in cash, of a unpopular housing tax levied last year.

During a rally yesterday, the media mogul promised he could promptly raise the €4 billion (about £3.5bn) required to pay back the tax on first homes, which was imposed by prime minister Mario Monti in an attempt to balance the books of the crisis-hit country.

To cheers from the audience, Mr Berlusconi, 76, said: “For the first time families will smile when they get a letter from the tax man.”

The three-time prime minister also promised that he was gearing up for his “last great electoral and political battle”.

Mr Berlusconi, a masterful communicator, peppered his speech with repetitions of the words “tax”, “taxpayer” and “tax man” along with references to “the anxiety of families”.

Mr Monti was quick to pour scorn on the pledge, claiming: “It’s magnificent – Berlusconi has governed for many years and hasn’t kept any promises.” He added: “Italians have good memories.”

Gianfranco Fini, a centrist politician and former Berlusconi ally, commented: “In his second cabinet meeting, Berlusconi will pass a decree guaranteeing certain victory to lottery players.”

Mr Berlusconi has rebounded in the polls after lagging the leading centre-left coalition by ten percentage points when he launched his electoral campaign in December.

Considered politically dead after he resigned in November 2011 amid an economic crisis and a stream of sex scandals, Mr Berlusconi has narrowed the gap behind his rivals to a few points thanks to a non-stop campaign of TV talkshow appearances.

Mr Berlusconi abolished the housing tax in 2008 before Mr Monti reimposed it last year, charging the average Italian family €278 for their first homes. Mr Berlusconi has said he handed over €300,000 in total on his properties up and down Italy.

To make up the €4bn shortfall created by scrapping the tax where it applies to first homes, Mr Berlusconi said he would tax Italians’ financial activities in Switzerland and cut the cost of government.

In an apparent insult aimed at Mr Monti, he added: “Even an imbecile can invent new taxes but only someone intelligent knows how to cut costs.”

Mr Berlusconi has said he would take over the job of economy minister if he won the election, leaving his party secretary, Angelino Alfano, to govern.

“That is, if Angelino Alfano reconfirms his trust in me,” joked Mr Berlusconi yesterday, who has been the voice and face of the centre-right campaign, often leaving Mr Alfano in his shadow.

Mr Berlusconi has blamed the housing tax for Italy’s current economic woes, ignoring the fact that he was forced from office by the crisis and had done little to boost Italy’s stuttering economy while in office.

Centrist leader Pierferdinando Casini said: “Watch out for Berlusconi because he is great salesman who could sell anyone a car with no engine.”

After getting his campaign under way by claiming that Germany was to blame for Italy’s crisis because it sold off its Italian bonds, Mr Berlusconi later admitted the claim was false.

One pledge which has received scant attention from analysts but has probably boosted Mr Berlusconi’s popularity with voters is his promise to relax a ban on cash transactions over €1,000, which has been a thorn in the side for the widespread black economy.

The former cruise ship crooner has also benefitted from a derivatives scandal at the Monte dei Paschi di Sienna bank which has close ties to the centre-left Democratic Party, as well as the constant bickering between Mr Monti and Democratic Party leader Pierluigi Bersani, despite the likelihood the two men will ally after the election.

Still a wily TV showman skilled at delivering soundbites, Mr Berlusconi has outperformed Mr Bersani, who has lacked charisma on the campaign trail.

Italy remains deep in recession. Last month, the central bank forecast that GDP will fall by 1 per cent this year rather than the previously forecast 0.2 per cent. Unemployment is seen climbing from 8.4 per cent in 2011 to 12 per cent by 2014.

 

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