ROME Jan 7 The new leader of Italy's Democratic
Party (PD) said on Tuesday that he supported raising financial
gains taxes in order to lower labour costs, and that he would
put forward the proposal as part of a larger reform package.
The 38-year-old Florence mayor Matteo Renzi was elected last
month as head of the centre-left PD, the largest party in Prime
Minister Enrico Letta's coalition government, and he has said he
will present a comprehensive overhaul of the country's labour
rules this month.
So far, few details have emerged about the reform package,
dubbed the "Jobs Act", but during an interview with La7 TV Renzi
said he would support higher financial gains taxes as long as
the extra revenue is used to lower a regional labour levy, known
"The increase in financial gains taxes will be one of the
points of the Jobs Act," Renzi said, without giving further
details. He said the tax increases must not lead to greater
government spending, but be balanced out by labour cost cuts.
Renzi also said the package would include as much as a 10
percent cut to energy costs for companies, without saying how
the reductions would be made.
With youth unemployment at more than 40 percent and the
overall jobless rate at record-high levels, Renzi has promised
sweeping changes to the labour system to create jobs, which is
also a top priority for Letta's government.
But Renzi gave no new details about how he plans to make
Italy's "dual track" labour system more flexible.
Now workers on full contracts enjoy extensive rights in
contrast to the army of others on temporary or part-time
contracts with little protection.
Former technocrat Prime Minister Mario Monti, facing
virulent opposition by labour unions, introduced a flawed labour
reform in 2012 that became one of the defining episodes of his
government and contributed significantly to its sharp fall in
(Reporting by Steve Scherer)