Andalusia consolidates itself as a benchmark for tax cuts after Madrid, although with little room for new measures

The institutions promoting the report have thus rewarded the Andalusian Government for the different fiscal measures that they have implemented in recent years and which will be completed throughout this month with the inclusion in the budgets of the Andalusian Government of two other more important measures. housing which will mainly affect young people under 35 who will benefit from more personal income tax deductions. In total, as summarized by the Minister of Economy, Finance and European Funds, Carolina España, theThe measures have so far had an impact of 900 million euros a third of which correspond to initiatives adopted in the field of housing.

But the two institutions that promote this ranking between communities maintain the high bar of requirements. And from there penalized Andalusia this year with a drop of 0.13 points (but without losing fifth position) and that they accompany their report with a battery of demands so that the Andalusian tax model comes even closer to that of Madrid, the community which leads this ranking.

“HASNdalucía could improve further if it eliminated most regional taxes and revamped the inheritance and gift tax (…) The same bonuses and reductions could also apply to family members in group III as in groups I and II. Another measure would be to reform the income tax by reducing the tax rates in all brackets (…) Finally, it is essential to deflate each year the income tax brackets and the personal minimums and family,” the report said. the senate.

The Secretary General of the Treasury of Andalusia, Manuel Vázquez, took charge of clarifying in the Senate the limits that Andalusia currently has to get closer to the Madrid model: “We want to continue to move forward with tax measures but we have limits. “We would like to be first but we don’t have the circumstances of Madrid.”

First, the Junta de Andalucía emphasizes that “when there are fewer taxes, more is collected”. But there is a legal limit: the spending rule set by the State and which conditions the growth of the budget. This regulation establishes that what is lost due to a tax cut counts as an increase in public spending. and therefore positions from other departments should be reduced. “We must respect the rules,” said the secretary general.

Secondly, the Ministry of Finance emphasizes that Andalusia, due to its socio-economic situation, has more need for public spending and strengthen services such as education or health compared to other regions like Madrid with a higher GDP per capita.

Regardless, Andalusia stressed in the Senate the need to guarantee the fiscal autonomy of the communities and that no limits be set in the negotiation of the new autonomous financing model. Likewise, the Secretary General of the Treasury asked, as did Minister Carolina España, on several occasions more participation in decisions taken by the Spanish government regarding VAT (since 50% is regional) and coordination in the management of personal income tax. Of course, there is no question of asking for management powers as Catalonia has done.

Budgets

The new tax measures on housing are among the main novelties of the new regional budget which will be presented to the regional Parliament before the end of the month. The Minister of Economy, Finance and European Funds, Carolina España, yesterday opened the doors of integrate certain proposals from opposition groups and influenced the priorities of these new accounts, which can in any case be approved by an absolute majority of the PP.

“It will be a budget in which we will continue our line. A budget in which services to citizens will be guaranteed, which will strengthen education, health or dependencyand this contributes to the Andalusian economic fabric and the creation of jobs,” explained the Minister of Economy, Finance and European Funds.