By Silvia Marchetti
ROME (MaceNews) – Rome’s push to tackle thorny reforms is opening more cracks among governing coalition partners, undermining support for Prime Minister Mario Draghi at a time when the Ukraine crisis calls for unity, ruling party officials say.
Draghi is trying to push through parliament fiscal reforms aimed at simplifying the tax system and a new competition law to deregulate key sectors, but center-right parties are battling against the overhauls.
In recent days, parliamentary sessions on a revision to Italy’s outdated land registry have seen Draghi’s rightist coalition partners — the League and Forza Italia — vote against the cabinet over fears of higher property taxes.
“During the lower house finance committee vote, the government’s land registry reform passed thanks to just one extra vote, meaning Draghi had a razor thin victory of 23 votes out of 22. And we will keep voting against the reform when it lands at the Senate, where our party has more men,” said a League official.
The land registry maps all properties in Italy and was first laid out 80 years ago. The goal of the reform is to update the value of buildings to add unregistered properties but the center-right is worried that the revision would mean higher property taxes for all house owners. Currently, Italians don’t pay property taxes on their first home, an exemption introduced in 2008 by then-Premier Silvio Berlusconi. Sources from his Forza Italia group say the exemption “remains a sacrosanct right we will always defend.”
Parliament will soon start voting on Draghi’s new fiscal reform, which would reduce the number of tax categories to four and reduce tax rates. The League wants to extend its historic flagship policy, a 20 percent flat tax on yearly earnings, to a maximum EUR 100,000. This flat tax already applies to self-employed professionals and firms earning up to EUR 65,000 and other coalition partners want to phase it out.
A Democrat official said the escalation of the Ukraine war was “reasonably diverting attention” from rising internal government clashes over crucial reforms that must be cleared before summer to show Brussels that Rome was advancing on its reform path, and therefore “fit to deploy direct post-pandemic EU aid.”
“We face several political hurdles this month, and the timing is real bad: the Russian-Ukrainian war should ease political tensions instead of raising them,” said the official.
Several sources argued that as next year’s general election vote approaches, coalition partners are increasingly at odds on key measures, they vote against the government in parliament, and hinder crucial committee work. As tensions intensify, Draghi is losing patience and must raise his voice to be heard, they add.
This week the lower house budget committee‘s scheduled sessions were suspended to give time to ruling parties to discuss and reach an agreement over the fiscal overhaul, to avoid more voting incidents like the one over the land registry.
The goal, according to sources, is to avert the risk that the pro-Draghi ruling block within the coalition, mainly comprised of the Democratic party and other minor center groups, might find itself in the awkward position of “being beaten by their same allies when committee voting takes place.”