Silvio Berlusconi's fate is hanging in the balance as Italy's highest court deliberates his appeal of a tax fraud conviction and sentence of four years in jail and a five-year ban on political office.

The five-judge panel began its deliberation Thursday afternoon, following two days of arguments by prosecutors and Berlusconi's defense. The highly anticipated decision threatens the stability of Premier Enrico Letta's fragile coalition government, which depends on cross-party support to approve reforms needed to help Italy out of recession.

Berlusconi's beefed-up legal team has argued to reverse the guilty verdict. Defense attorney Franco Coppi also offered the court an alternative: order a new trail, a move that might reduce the risk of a ban on political office.

It is unclear when a decision will be issued.