The tax reform prior to the 2025 general budgets that the Government is negotiating with its parliamentary partners is hanging by a thread. The parties are giving themselves a new opportunity to harmonize positions that seem irreconcilable. The only certainty is that, by European mandate, Spain will impose a floor of 15% on corporate taxes on multinationals. The tax on banks, capital income and the special tax on energy companies are on hold. ERC, EH Bildu and Podemos, on one side, against PNV and Junts. And these received the support of the PP at the last minute.
The EU has forced its member countries to establish a minimum effective rate for large companies to prevent unfair tax competition that has benefited countries like Ireland in the past. The European directive must now come into force in Spain, which faces heavy fines if it does not do so.
The government saw in this procedure the possibility of expanding the package and adding fiscal measures that could help facilitate the negotiation of the general state budgets of 2025, a key element for Pedro Sánchez to continue in office legislative.
The PSOE, which leads the negotiations within the government, has agreed with its most right-wing allies, the PNV and Junts, to extend for three years the extraordinary tax on the banks, which are accumulating record profits , and to apply tax increases on tobacco to hydrocarbons. and capital income.
The counterpart was the abolition of the tax, also extraordinary, on the profits of energy companies. PNV and Junts share interests in this sector, which is very important in Euskadi and Catalonia, particularly in Tarragona. The employers’ association Foment del Treball has clearly expressed its position.
Then came the PSOE agreement with Sumar, which extends the tax burden to the highest incomes and makes the bank tax permanent. But the energetic one was still out of the pack.
The problem is that the government does not have the parliamentary majority to carry out this reform because ERC, EH Bildu and Podemos demand that the tax on energy companies be included in a package.
And the confrontation with the two right-wing partners was strong. So much so that the normally calm spokesperson for the PNV in Madrid, Aitor Esteban, appeared this week, visibly embarrassed, in which he asked for “common minimums” in the negotiation.
Negotiations had a deadline last Thursday, but the government assumed it did not have the necessary majority and chose to postpone the Finance Committee session until Monday.
Because the groups on the left are willing to assert their votes, which “are worth the same as those on the right,” as the negotiating groups explain to elDiario.es. “They made a pact with the right to remove the tax on large energy companies and they intend to swallow EH Bildu, ERC and Podemos,” they add.
On the parliamentary left, they fear that the Ministry of Finance wants to limit tax reform to this package currently being negotiated and ignore other of its demands concerning the budget negotiation.
The PP, on the hunt for Budgets
A new factor has appeared in the equation: PP. Those of Alberto Núñez Feijóo saw the opportunity not only to show the fragility of the parliamentary majority that supports the government, but also to make an agreement on this tax reform more difficult and, by extension, to limit Sánchez’s options for establish public accounts. of next year.
In a statement sent to the media this Thursday, the PP said that the government wants to “impose a new wave of taxes to the detriment of the majority of citizens, who are already suffering from real fiscal hell.” But he added: “The PP is against any tax increase and will only support those that are imposed by the community framework, as is the case of the transposition of the directive on the complementary minimum for businesses agreed in Brussels “.
That is to say, the PP would vote in favor of establishing a minimum of 15% for Businesses, but not for the rest, which limits the pressure that can be exerted by the Government and by the left parliamentarian against the PNV and the Junts who do not do it either. want something other than the ratification of this same directive.
In a second statement on Thursday, the PP developed the “parliamentary weakness of the Executive” and reiterated that Feijóo’s party “will only support those who are imposed by the community framework.”
From the left, they have taken up the challenge and, as the different groups explained to elDiario.es, they are ready to ensure that the Finance Commission only gives what Brussels demands and to postpone the legal reform for include it in the budget. framework, where it is also They must determine income and expenses for the entire year.
“One solution could be to approve the European package as it is, without amendments,” underline EH Bildu. “And treat taxes in another way, there is time until December 31,” they add. Podemos also proposes limiting the reform to businesses and extending the banking and energy reforms by six months, which would give more room to negotiate them “within the budgets”.
The government does not want the PP
But the government does not want to hear about the PP to carry out the obligatory transposition of the European directive. The Executive does not want the opposition to be involved in tax reform and prefers to accelerate with its partners in Congress any option aimed at implementing a set of tax measures of a clearly progressive nature.
It is for this reason, explains the government, that it chose to cancel the Finance Commission for the second time in a week. “If we canceled it is because we appreciate that there is water in the pool, because we see options” of agreement, say sources from the Executive.
The government is reluctant to rely on Feijóo at a time like this and on an issue as ideologically charged as fiscal policy. “The negotiation must take place on the left because we have agreed on progressive measures, such as the banking tax that the PP rejects,” add these sources.
What the department of María Jesús Montero excludes is that it is possible to extend the special tax on energy companies beyond December 31. “We would like to maintain this tax, but we do not have the figures. The majority of Congress is what it is, and the PNV and Junts stick to that, it is impossible to convince them,” they conclude at the Treasury.
The negotiation of the tax package is taking place in parallel with the conversations initiated with Carles Puigdemont’s people for next year’s public accounts, the first of this government, the real step that the Executive prioritizes with a view to guaranteeing a stable legislature. This is why they do not want to make a misstep with Junts that would call budgets into question.
The second extension to allow negotiation will be the last. The deadline is this Monday, when the Finance Committee has been rescheduled. The Treasury will discuss throughout the weekend with left-wing parties like ERC, EH Bildu and Podemos to try to convince them to renounce, at least in this legislative package, the special tax on energy companies, the last obstacle to ‘agreement. But without removing from the package the other taxes agreed with Sumar, PNV and Junts.
The Government is open to putting other proposals on the table which will ultimately win over and prove all its partners, both right and left, right. “It is difficult for us to see the progressive parties voting against all this,” they emphasize at the PSOE, where they value the fact of having managed to wrest the rest of the measures from the conservative parties like the PNV and Junts. But the House’s left-wing groups are in no hurry, nor do they want to close the window of opportunity to negotiate tax measures that will be essential for state revenues and, therefore, for the 2025 accounts.
