President warns Spanish PM to negotiate new tax deal for Catalonia or lose support 

Pere Aragonès says any backing for Pedro Sánchez's government in Congress is dependent on bilateral talks on finance 

President Pere Aragonès speaks at an event in Madrid
President Pere Aragonès speaks at an event in Madrid / Miquel Vera

ACN | @agenciaacn | Madrid

March 20, 2024 06:59 PM

The Catalan president has warned the Spanish prime minister that there will be no new agreements to support legislation in the Spanish Congress without talks on a new 'singular financing' tax model for Catalonia. 

Speaking in Madrid on Wednesday, Pere Aragonès said Pedro Sánchez had committed to talks on financing during the negotiations to be re-elected, when he required the support of Aragonès' party, pro-independence Esquerra Republicana (ERC). 

"He will have to comply with the investiture agreements and negotiate," Aragonès said, emphasizing that ERC has always said that "new agreements can only be made if previous ones are fulfilled." 

Aragonès said that the negotiations with the Spanish government over funding must be bilateral, between the two executives, excluding regional governments from other Spanish Autonomous Comunities. 

"With a multilateral relationship, there will be no agreement," the president warned. 

Catalonia must "take advantage" of parliamentary arithmetic 

Aragonès traveled to Madrid to explain his government's proposal for singular financing, which was released on Tuesday and envisages Catalonia collecting 100% of the tax income raised within the territory. 

The president insisted that a new funding model for Catalonia needs to be tackled during the current congressional term, and that ERC wants to "take advantage of the opportunity."

There will be many votes during the term where the Spanish government will be relying on support from ERC and other parties, including pro-independence party Junts, to pass legislation in Congress.   

New financing proposal 

The 'singular financing' model would give the Catalan government "the key to the safe," amounting to around €52 billion per year, the Minister of Economy and Finance, Natàlia Mas Chalk, said in a press conference on Tuesday. 

The proposal includes plans for financial contributions to the Spanish state and to a new territorial rebalancing fund. 

The model is based on "full fiscal sovereignty" and would imply that the government manages and collects taxes including VAT, personal income tax, corporate tax and special taxes, going from managing 9% of tax to 100%. 

The government would receive approximately double the €25.6 billion it received in 2021 under the current model.