The Italian government approved a euro47 billion ($68 billion) austerity sweep Thursday to show financial markets and the European Union it is serious about balancing its budget.
The decree drafted by Finance Minister Giulio Tremonti was approved during a Cabinet meeting and now passes to Parliament for a vote.
The three-year-plan aims to bring the government's budget deficit of 3.9 percent this year to near balance by 2014.
Ratings agencies have recently issued worrisome reports about Italy's low growth and public debt, which, at around 120 percent of its GDP, is one of the highest in Europe.
The plan features new taxes on financial transactions, tax breaks for young entrepreneurs, extending a public sector hiring freeze, and cutting ministries' budgets as well as cracking down on tax evasion.
Tremonti told a press conference it included a mix of budget cuts and income into public coffers that wasn't so much an economic objective but a "moral and political" one to balance Italy's budget deficit.