Rome says it will lose $29 million if churches get new tax break

Rome, Italy - The city of Rome complained Monday it would lose $29 million if a proposed tax break for the Roman Catholic Church and other religious institutions is included in the nation's 2006 budget.

Under a provision in Premier Silvio Berlusconi's budget, which is awaiting final approval in parliament, all church premises leased for commercial purposes would be exempt from property tax. Churches and venues of worship already are exempt.

The proposed exemption also would be extended to other religions that have a convention with the state, as well as nonprofit organizations. The Catholic Church, though, owns hundreds of buildings in Rome and elsewhere.

Marco Causi, who oversees Rome's budget, said in a letter to Economy Minister Giulio Tremonti that the exemption would – conservatively – cost the city the equivalent of $29 million.

The letter was sent as the lower house of parliament prepared for a final budget vote this week.

Critics contend that the measure was intended to court Catholic voters before next year's general elections. The city of Rome is run by a center-left mayor.

Tremonti has shrugged off the accusations and denied that the measure would gravely affect city hall.