Romano ProdiFor the complete report in Bloomberg.com click on this link
Merkel, Prodi Tax Plans May Inflict Pain Beyond Their Borders- by Simon Kennedy and John Fraher
Sept. 5 (Bloomberg) -- The taxman is about to pay a visit to consumers and businesses in Europe that will inflict pain around the world. German Chancellor Angela Merkel and Italian Prime Minister Romano Prodi plan to raise taxes to reduce their budget deficits, increasing pressure on the European economy only months after it recorded its best growth since 2000. Confidence in Europe's expansion is already waning amid rising interest rates, declining foreign demand and record fuel bills.A slowdown in the dozen euro nations would deal a blow to global growth at a time when the U.S., the world's largest economy, is decelerating with the end of a housing boom.
The higher taxes are ``coming at a bad time, when we can see other problems for the global economy coming down the line,'' says Michael Heise, Frankfurt-based chief economist at Allianz AG, Euro
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