Italian prime minister presents €30 billion budget plan

Rome (CNN) — Italy’s new prime minister presented lawmakers with his proposal for €30 billion ($41 billion) in new taxes and spending cuts Monday, saying the “painful measures” would end the country’s budget crisis.

“We are aware that the measures mean sacrifices. But not making the sacrifices today would mean making more painful ones in a few weeks, maybe even in a few days,” Prime Minister Mario Monti told the lower house of Parliament Monday, a day after his Cabinet adopted what he has dubbed a “Save Italy” decree.

About €20 billion would come from cuts, including major changes to how Italian workers’ pensions are calculated and a one-year increase in retirement ages, effective in January, Monti announced.

“We are in a very crucial week,” Monti said Monday, adding that he was confident Parliament would back his plan to help Italy recover from the financial crisis that has also clouded the future of Europe’s common currency.

“The future of the euro also depends on the decision we are undertaking. We are certain that Italy will not fail,” he told lawmakers in the lower house.

The upper house of Parliament also heard Monti’s proposal. Lawmakers were expected to vote later this month on the emergency decree.

“Without this package. Italy collapses. It will go to (the situation in) Greece. … We have a strong sympathy for Greece, but we don’t want to imitate them,” Monti told reporters.

The rest of Monti’s package involves a 1.5% tax on financial transactions, a new tax on high-end boats, cars and planes and efforts to crack down on tax evasion. It would cut provincial government costs while attempting to boost the Italian economy by rebuilding infrastructure.

In announcing the cuts late Sunday, Monti — who also serves as finance minister — said he would take no salary for either position.