Berlusconi ministerial resignations spark Italy crisis
The party of Italy's former Prime Minister Silvio Berlusconi says all five of its ministers are resigning from the shaky coalition government.
The development follows weeks of worsening relations between his party and Prime Minister Enrico Letta's centre-left grouping.
Mr Berlusconi had already threatened to withdraw his ministers if he is expelled from the Senate for tax fraud.
The crisis could lead to fresh elections amid economic problems.
Mr Letta flew back from New York on Friday in an attempt to prevent the government from collapsing.
The prime minister said late on Friday that he would quit unless his government won a confidence vote due next week in parliament.
In a statement, Mr Berlusconi described that ultimatum as "unacceptable".
Mr Berlusconi's centre-right People of Freedom (PDL) party objects to a planned increase in sales tax, which is part of wider government policy to plug Italy's large debts.
"I have invited the People of Freedom delegation in the government to assess whether it is opportune for them to hand in their resignations," Mr Berlusconi said.
Interior Minister and PDL Secretary Angelino Alfano accused Mr Letta of "a grave violation of the pacts that this government is founded on".
But the prime minister responded angrily to the resignations, accusing the PDL leader of telling Italians a "huge lie" in using the sales tax as an alibi for his own personal issues.
"In parliament, everyone will have to assume responsibility for their actions before the nation."
Mr Berlusconi's legal problems are seen as a cause of much of the tension inside the coalition.
A committee of the Senate decides next week if he should be expelled after the Supreme Court recently upheld his conviction for tax fraud.
It was his first conviction to be confirmed on appeal in two decades of fighting legal cases.
Mr Berlusconi was sentenced to a year in jail, but is expected to serve house arrest or community service because of his age.
The BBC's correspondent in Rome, Alan Johnston, says the government is being pulled apart as Mr Berlusconi fights the moves to expel him from the Senate.
Fresh elections are a real possibility, our correspondent says, but there may also be an attempt to stitch together a new governing coalition drawn from factions in the current parliament.
Before news of the resignations broke, Italian President Giorgio Napolitano called for continuity.
"We need a parliament that discusses and works, not that breaks up every now and then," he said.
The coalition government was put together after inconclusive elections in February.
It is feared that the crisis could hamper efforts to enact badly needed reforms to tackle Italy's economic problems, including the debt, recession and high youth unemployment.
The International Monetary Fund has warned that coalition tensions represent a risk to the Italian economy.