Italy's government has stopped its public financing of political parties, after a rash of scandals involving politicians who misused some of these funds for personal luxuries.

During a Cabinet meeting Friday, Premier Enrico Letta said his government issued a decree scrapping the practice that put millions in the coffers of political parties. Instead, taxpayers will have the option of designating 0.2 percent of their annual income tax to a particular party. If taxpayers don't want to see any of their taxes go to political parties, the 0.2 percent will be earmarked for general spending by the government.

Letta also said political parties will be required to have an external audit of their books to ensure money is properly spent.