The rating on the City of Milan reflects its good liquidity position, still-strong fiscal flexibility, and low contingent liabilities thanks to a profitable portfolio of shareholdings. These factors are offset by tightened budgetary performances and a high debt burden, which could continue to increase on the back of an ambitious capital program. The city's robust tax base and low tax rates give it significant revenue-raising flexibility by national and international standards. Despite the national abolition of property tax on the main home, Milan's tax flexibility remains solid, at about 15% of operating revenues budgeted in 2009. So far, however, this has been mitigated by a political desire to keep tax pressure unchanged. In 2007, Milan's budgetary performance deteriorated. The operating
