The PSOE and Junts bank rate increases the maximum rate from 5,000 million to 7%

The last minute agreement that the government managed to obtain yesterday from BNG, Bildu and ERC, after an agonizing Finance Commission, resurrects the banking tax that Moncloa agreed with Junts, which – as could be expected – will be approved Thursday by the plenary session of the Council of Ministers. The agreement signed with those of Puigdemont toughens taxation for the entities with the highest income from interest margins and commissions, that is to say the large banks. Adds a new section from 5,000 million euros of tax base which will be taxed at the rate of 7%. The initial proposal set the limit at 6%, for bases above 3 billion. This is maintained, as well as the rest of the projected scale: a rate of 3.5% for bases of 750 million, and 4.8% for those above 1.5 billion. Remember that the temporary tax established a single rate of 4.8% from 850 million annual income. The change therefore benefits medium-sized banks, which will benefit from the progressive scale of the new tax.

In addition, the new wording expands the scope of the tax to all “credit entities established in Spain”, that is, the figure will be imposed – if ultimately applied – to all banks that operate in Spain, whether or not they have their headquarters there. This is important, because the tax will no longer only affect Spanish banks, but also foreign entities. This was one of the demands of Spanish banks, who considered that the temporary tax put Spanish entities “in a disadvantageous situation in the financing of our companies”.

Everything will depend on the implementation by Moncloa of its plan aimed at “saving” most of the tax reform which failed yesterday at the Finance Commission. Although the transactional amendment signed by Junts, the PSOE and Sumar was rejected at a minimum, it can be voted on again on Thursday in the plenary session of Congress. However, this time she has more options to thrive. The government succeeded in attracting to the extreme an agreement with BNG, ERC and Bildu, which could unblock banking and energy taxes. The Executive promised to approve the permanence of electricity company tariffs by royal decree. However, the new tax will have limits – in turn agreed with Junts – and “will not tax energy companies that maintain their effective investment commitment to decarbonisation”, according to Treasury sources.

In exchange, the left undertakes to approve the tax on banks agreed with Puigdemont, and what remains of the abortive tax reform that the PSOE introduced through amendments to the law on the minimum tax of 15% on multinationals.

But everything depends on the decision of Podemos, essential for the maneuver orchestrated in La Moncloa to succeed. Those of Ione Belarra limited themselves to declaring that they would not support a text which did not include the tax on energy companies. However, they have not confirmed – yet – whether the commitment to approve it by royal decree was worth it.