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Thursday, Aug 29
Italian PM to scrap property tax in concession to Berlusconi
- Italian Prime Minister Enrico Letta has pledged to scrap an unpopular levy on primary residences this year and replace it with a municipal tax in 2014.
- The cancellation of the tax was a key demand from Silvio Berlusconi's PDL to remain in the government. Their other major requirement is that Berlusconi is not thrown out of the Senate for his conviction for tax fraud.
- The EU, meanwhile, wants to know how the government will offset any revenue lost because of the tax move so that it will meet its budget commitments.
- Italian shares (EWI) are +1% while 10-year bond yields (ITLY, ITLT) are flat at 4.4%.