Italy puts 2014 growth forecast at 0.8 per cent; Renzi says he’s got payroll tax cut covered

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MILAN – Italian Premier Matteo Renzi’s government has approved a budget framework that puts economic growth at 0.8 per cent this year.

The government is working on a raft of structural and fiscal reforms aimed at boosting Italy’s economy out of stagnation. The three-year budget approved Tuesday will be submitted to the European Commission later this month, and the growth estimate compares with the International Monetary Fund’s 0.6 per cent forecast.

The Cabinet is set next week to enact new measures announced previously, including a payroll tax cut that aims to give low wage earners an additional 80 euros ($110) a month. Renzi said the 6.7 billion euros ($9.25 billion) needed this year to cover the payroll tax cut will come from tighter government spending and new tax revenues.

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