For the first time ever, the European Commission has rejected the budget of a European Union member state.
On October 23, Brussels said Italy’s spending plans for 2019 were violating the bloc’s debt limit and needed revision. Rome was asked to submit a new budget within three weeks.
“Today for the first time the Commission is obliged to request a euro area country to revise its draft budgetary plan,” said EU Vice President Valdis Dombrovskis, adding that the bloc’s executive arm saw “no alternative” to the rebuke.
As reported by Deutsche Welle (DW), Germany’s international broadcaster, the budget standoff between Brussels and Rome has intensified in recent weeks because the Italian government, made up of the anti-establishment 5-Star Movement and the far-right League, insisted on tripling the country’s fresh borrowing from 0.8 percent of gross domestic product (GDP) to 2.4% next year.
Brussels argues the hike would far exceed the spending limits agreed with the EU and further increase Italy’s national debt, which is already the highest in the EU.
However, the Italian government immediately replied to the budget rejection, saying it would stick to its budget plans and that the EU had no right to meddle in Italy’s affairs.
Deputy Prime Minister Matteo Salvini said that Rome “won’t subtract one single euro” form its spending plans.
“They’re not attacking a government but a people. These are things that will anger Italians even more and then people complain that the popularity of the European Union is at its lowest,” Salvini, who’s also the League leader, told journalists during a visit to Romania.
In a separate report, the Agence France-Presse (AFP) noted that if Italy fails to comply with the Commission’s request, it could face disciplinary action. This could lead to fines of 0.2 percent of its GDP, or 3.4 billion euros, based on 2017 figures.