The Government postpones, a few minutes before its vote, the debate on the tax reform that it had introduced as amendments to the law on the minimum tax of 15% on multinationals. The PSOE failed to repair the seams of the investiture bloc, having agreed with Junts to withdraw the permanence of the energy tax, and with the PNV a tax on the banking sector, refined by financial entities themselves. Result: a text that the left refuses to support, and which must be rethought and renegotiated by Ferraz in the next three days. The Minister of Finance, María Jesús Montero, tried – until the last moment – to reach a minimum agreement, which she has so far failed to conclude.
While waiting for what will finally happen next Monday, parliamentary sources assure that everything indicates that the Government will end up withdrawing the amendments to save the initial law, which respects a European transposition, and which seeks to include an additional tax to ensure a minimum level global taxation of multinational companies. The European Commission requires countries to approve this standard, to avoid future sanctions.
If the PSOE fails to convince the rest of the groups, the proposed tax package will be declined: elimination of the special tax regime for “sociimis”, of the tax on luxury products (cars, yachts or private yachts) or of the exemption for individuals. health insurance premiums. Also the permanence of the two taxes on the banking sector and on energy, which will bring in only 2.859 million euros this year, the increase in the maximum personal income tax rate on capital income from 28% to 29%; the technical reform of corporate tax, which corrects the nullity that the Constitutional Court pronounced regarding the modification undertaken by former minister Cristóbal Montoro, and the modification of the VAT directive, with the aim of levying this tax on tourist accommodation rental platforms.
With everything to do, deadlines are against Moncloa. The Executive – which is trying to take advantage of a current bill to speed up the deadlines for its labor reform – will have to redo the process in the middle of a political war with its investiture partners, if it does not reach an agreement on purpose . The project agreed between the PSOE and Sumar, which both proposed as a reform plan, displeased Junts and the PNV as much as the parties to the left of Sumar (ERC, Bildu and Podemos). But he did it especially to those of Carles Puigdemont, who continue to monitor from afar the parliamentary disorder from which the PSOE suffers. The training clearly showed from the start that the tax reform that was implemented “had to be theirs, otherwise it wouldn’t be.”
Catalan separatists and Basque nationalists reject measures that involve tax increases or that jeopardize the strategic investments of banks or energy companies in their territories. It should be remembered that Repsol’s threat to entrust Portugal with a 1.1 billion euro project in Tarragona and pressure from BBVA and CaixaBank precipitated the failure of these two measures, which the government itself even promised to promote in Brussels. On the other side, left-wing groups are straining and demanding the permanence – yes or yes – of the two taxes.
Redo a renovation in record time
Given these elements, the government finds it difficult to present a tax reform which – at least – has a chance of being adopted by the Congress of Deputies. In addition, the dispute over the investiture bloc calls into question Moncloa’s options to carry out a budgetary project for 2025.
Added to this is the pressure from the Community Executive, which is still waiting for the budgetary plan to be sent, which must complement the structural budgetary plan that Spain sent to Brussels a month ago. In the document, the Economía included the commitment to promote a tax reform capable of guaranteeing revenues of approximately 4.5 billion euros per year, or 0.3% of GDP. And as if that were not enough, the absence of a tax reform law jeopardizes the receipt of 7 billion euros from the fifth installment of the “Next Generation” funds. A challenge which poses difficulties not only for the budgetary trajectory, but also for the estimated growth of GDP in the short term. Even if a drop in public consumption is estimated from 2025, Moncloa relies part of its economic strength on investments that European funding should continue to keep alive.
