Power Play Upends Italian Politics

The political forces behind expremier Silvio Berlusconi sharply raised the stakes Friday in their battle to return to power.

They declared opposition to the government’s deficit-cutting package, saying it relied too heavily on higher taxes.

The announcement sent politics into a new stage of uncertainty and pushed the lira down to a record low against the benchmark German mark.

Premier Lamberto Dini’s government presented the package, mainly new taxes and some cost-cutting, as one of his four priorities. He has said in the past he would resign if his limited mandate is blocked.