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Salvini Pledges Flat Tax in Budget, Urges EU to Promote Growth

Salvini Pledges Flat Tax in Budget, Urges EU to Promote Growth

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Italian Deputy Premier Matteo Salvini vowed to push through a so-called flat tax in the 2020 budget, insisting that the European Union must allow his country to adopt pro-growth measures as Rome seeks to ward off a debt infringement procedure.

The dominant force in the populist coalition after last month’s European election, Salvini of the rightist League party won approval from the cabinet on Tuesday to give him more powers to curb illegal immigration, relieving tensions which had split the administration before the ballot.

“The flat tax and big cuts in taxes for companies and families will have to be a fundamental part of the next budget, so we hope that Europe will allow Italy to return to growth,” Salvini told reporters after the cabinet meeting. “A big, substantial cut in taxes is the only way to reduce debt.”

Salvini Pledges Flat Tax in Budget, Urges EU to Promote Growth

Italy is seeking to fight off a disciplinary procedure by the European Commission for failing to rein in debt. Prime Minister Giuseppe Conte has sought to portray the administration as united in its tussle with Brussels, saying his deputies Salvini and Luigi Di Maio both agree that EU sanctions must be avoided at all costs.

Flanking Salvini after the cabinet meeting, Conte said the government must start work now on the 2020 budget, which must be approved by parliament by the end of the year. Conte said he would discuss economic issues with Salvini and Di Maio, leader of the anti-establishment Five Star Movement, Wednesday morning.

The cabinet approved a revised a decree which gives Salvini’s Interior Ministry a stronger say over migrant boats in Italian territorial waters, and sets new rules on security.

Salvini said the package includes impounding boats “from those who repeatedly don’t obey conventions and bans on entering territorial waters,” and imposes fines of 10,000 euros to 50,000 euros ($57,000) on the captain and owner of ships which fail to obey orders from coast guards.

On the eve of European Parliamentary elections last month, Salvini had sought to ram through the measures, triggering a clash with Di Maio. Salvini has used the immigration issue to gain voters and become Italy’s most popular politician.

To contact the reporter on this story: John Follain in Rome at jfollain2@bloomberg.net

To contact the editors responsible for this story: Ben Sills at bsills@bloomberg.net, Dan Liefgreen, Alessandro Speciale

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