Italy has outlined plans for "very strong" budget cuts next year including an increase of taxes on investment accounts and cuts in social welfare.

"We need to have very strong austerity measures in 2012 and 2013," Finance Minister Giulio Tremonti told lawmakers who were called back from summer recess to discuss a series of measures to stop Italy from plunging into a debt crisis.

Tremonti said the government planned to slash bureaucratic costs, launch a programme of privatisations, reform social welfare and raise the tax on investment accounts to 20 percent from 12.5 percent at the moment.

He said the European Central Bank had outlined a list of "indications" for Italy to promote economic growth, cut spending and bring its public accounts back into line in a letter last week ahead of its massive purchases of Italian bonds.

The ECB requests included cuts in public sector salaries and labour law changes to allow employees on permanent contracts to be fired.

"The government does not necessarily share these," he said.

The ECB has been buying up Italian and Spanish government bonds to help ease their borrowing costs and so fend off growing strains on their public finances.