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tax harmonization is “illegal and unconstitutional”

Madrid

Updated: Friday, November 27, 2020 2:09 PM

Published on: 11/27/2020 2:05 PM

The PP raises the tone against the pact of the government and the ERC to harmonize regional taxes in Spain, with that of heritage as the main axis of battle. Popular president Pablo Casado has rightly insisted from Catalonia on the fact that this equalization proposed by the government “is illegal and unconstitutional”.

“Tax harmonization is illegal and unconstitutional in Spain. It is an autonomous state and allows a fiscal margin for autonomies which allows them to reduce or increase certain tax bases,” said Casado, who subsequently denounced Madrid being qualified as a “tax haven”. those who maintain a “fiscal hell” in Catalonia.

The popular president thus comes to the rescue of the president of Madrid Isabel Díaz Ayuso, in her particular crusade against the intention of the central executive to review regional taxation. ERC Congress spokesperson Gabriel Rufián announced that he had agreed with the Sánchez government to create a bilateral committee to end Madrid’s “tax haven”.

In the spotlight, the wealth tax: a tribute transferred to the autonomous communities which taxes personal wealth and which Madrid rewards 100%, exempting large fortunes (those who suffer the most) from paying.

“In the PP, we love the autonomous state and the Spanish tax system and that is why we will continue to defend that where we govern we will continue to lower taxes. In Madrid, which is the autonomy that the socialists and the separatists aimed at, There is no tax haven, but there is an alternative model to the tax hell in which the separatists have transformed Catalonia and that Sánchez wants now extend to all of Spain, ”insisted the conservative leader.

Several Autonomous Communities argue that this is unfair competition and “fiscal dumping”, since Madrid attracts the great fortunes of other communities with these tax advantages, subtracting the less funded regions from property income.

The PP raised the tone from Barcelona, ​​where Ayuso also traveled and insisted on his accusations that this is a “fiscal hell”: “They only intend to impose fiscal policy ideologically not to improve Catalonia, but to continue to harm Madrid. “.

One of the protagonists of the debate, Gabriel Rufián, decided to use social media to speak out, which suggests that, in what is called in other countries “paying taxes”, the Spanish right says that ‘she is “separatists restricting the freedom of rich entrepreneurs”.

Harmonize “à la Madrileña” or “à la Catalana”?

Now, what should this harmonization consist of? Popular leaders as important as Alberto Núñez Feijóo have argued that “it’s not bad” if it’s on the decline.

“Harmonization is not just about increasing taxes, it is looking for taxes and the possibilities of establishing maximum and minimum ranges,” said the Galician.

The question is whether this harmonization should be “à la Madrilène”, imposing very low maximum rates, or “à la Catalan”, establishing brackets which oblige Ayuso to tax the great fortunes. The employers’ association is clear: “If it is a question of harmonization with that of Madrid (lower taxes), we would understand it”, declared its president, Antonio Garamendi.

Even the PNV is in favor, but ensuring that the Basque concert and the Navarre agreement – guaranteed in the Constitution – do not touch each other.

The idea of ​​imposing minimum and maximum rates on regional taxes is not new: in 2017, the then Minister of Finance, Cristóbal Montoro, commissioned an expert report to reform the autonomous financing system . One of the conclusions of this text: “It would be desirable to harmonize the taxable and chargeable bases of the taxes transferred totally or partially.”

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