fiscal balances

Catalonia’s Tax Administration is launched to guarantee self-government

February 20, 2014 09:33 PM | ACN

The new Tax Administration of Catalonia (called ‘Tributs de Catalunya’) has been launched on Thursday in a ceremony chaired by Artur Mas, the President of the Catalan Government. Mas highlighted that “all of this is not against the Spanish State” but “an investment for a better Catalonia”. The new body was created from merging the existing Catalan Government’s Tax Agency and the ones of the four Provincial Councils (Barcelona, Girona, Lleida and Tarragona). Its creation was already foreseen in the Catalan Statute of Autonomy approved by the Spanish Parliament and the Catalan people through a binding referendum in 2006. It will start with 53 branches, which will mostly deal with municipal taxes. Gradually it will dispose of up to 200 offices dedicated to ensure Catalonia’s fiscal sufficiency. The project was launched in September 2012, aiming to build “a state structure” that would ultimately be able to collect all the taxes generated in Catalonia if needed.

Catalan parties welcome Rajoy’s rectification in publishing fiscal balances after all

February 5, 2014 09:48 PM | ACN

After a great controversy and outraged reaction from businesspeople, politicians and academics, the Spanish Government has amended its previous decision and on Tuesday evening it announced that it will publish the so-called fiscal balances. This financial instrument shows how much money the citizens and companies from a territory give to the central government and how much of this money comes back in form of funds, investments and services. Previous studies showed that Catalonia has been giving away an average of 8% of its GDP each year since 1986, which represents 6 times the entire Marshall Plan in comparable currencies. The Spanish Government was supposed to publish the fiscal balances in December but a month later it announced it would not do so since they were “used to foster Catalonia’s independence” claims. Catalan parties warned Rajoy not to alter the figures and calculation to produce the result he wishes.

“An independent Catalonia should not pay” for Spain’s “odious debts”, says employer association

January 31, 2014 01:37 PM | ACN

The President of the employer’s association Cercle Català de Negocis (CCN), Albert Pont, stated that part of the Spanish Government’s debt is “odious” and therefore Catalonia cannot recognise this “illegitimate debt”. However, Pont underlined the “willingness” to pay for the proportionate share of the rest of the debt, which should be calculated “item by item”. In an exclusive interview with the CNA, he denounced a public debt generated “for the benefit of no more than a few companies” that “provide works, services and infrastructures” for the Spanish Government. “If Spain does not recognise the independence of Catalonia, Spain should assume its debt completely and the Catalan Government its own debt”, he warned. In addition, Pont denounced the fact that the Spanish Executive is taking away “between €16 billion and €18 billion” from Catalonia each year, a fiscal deficit amounting to “around 9%” of the Catalan GDP. “The IMF already established that fiscal deficits exceeding 4% of the GDP of a territory amounted to colonial relations”, he highlighted. Besides, he explained that “the average custom duty is between 1.4% and 1.5%”. However, Pont ruled out this possibility since a “political solution” will be reached to keep Catalonia within the EU.

Catalan businesspeople annoyed with Spanish Government for not issuing fiscal balances

January 28, 2014 01:43 PM | ACN / Gaspar Pericay Coll

The Catalan business community is deeply annoyed with the Spanish Government for not publishing transparent data on Catalonia’s fiscal contribution to the rest of Spain and therefore not recognising the fiscal deficit. The Spanish Finance Minister, Cristóbal Montoro, was supposed to issue the so-called fiscal balances last December but their publication was inexplicably delayed. Last Friday, in late January, Montoro announced the fiscal balances would no longer be calculated and published in the present form; instead, he would publish in March the “regionalised public figures” stating the costs of public services per citizen because the fiscal balances were “incomplete and incoherent”. However, on Tuesday, the Minister recognised that they were “correct” but “wrongly used” to support Catalan independence claims.

Catalan Finance Minister accuses Rajoy of sidelining and homogenising the Autonomous Communities

January 24, 2014 02:57 PM | ACN

Andreu Mas-Colell, Catalan Finance Minister, accused the Spanish Government of aiming “to undo” the system of Autonomous Communities. He also expressed his fear that the so-called ‘coffee for all’ system [the generalised devolution of the early 1980s that shaped the 17 Autonomous Communities] will become a ‘decaffeinated coffee’ system, implemented ‘in depth’. With this play on words, Mas-Colell was referring to a deep recentralisation and homogenisation process. Furthermore, the former professor of Economics at Harvard and Berkley, denounced “the budget treatment” that the Spanish Government gives to Catalonia as “totally unfair”. In this vein, he proposed that an international and independent body should calculate the fiscal balances between Catalonia and the Spanish State.

Experts suggest increasing cooperation between an independent Catalonia and Spain

December 20, 2013 09:21 PM | ACN

The Catalan Government’s Advisory Council for the National Transition (CATN), formed of renowned independent experts, emphasised that Catalonia’s independence from Spain would not represent breaking their affective and historical bounds. Furthermore, they insisted on the need to continue and even to increase cooperation “based on a new principle of equality and mutual respect between both parties”. They have suggested different ways to cooperate, through different structures. For instance, they proposed the creation of the ‘Iberian Council’ bringing together Catalonia and Spain, as well as Portugal and Andorra if they wished to, which would mirror the Nordic Council or the Benelux. Furthermore, the CATN issued three other reports, including a detailed analysis of Catalonia’s tax agency.

The PP to finally block the Catalan Government’s budget

December 17, 2013 08:27 PM | ACN

On Monday the People’s Party (PP) announced they were considering freezing the 2014 Catalan Government’s budget of €29.31 billion. The reason is that they include €5 million (0.017% of the total spending) to fund “electoral processes and citizen consultations”, which they fear could fund a self-determination vote. The Catalan Government has the power to organise a consultation process, as well as to modify small items once the budget is approved. The PP was waiting for the Spanish Finance Minister’s green light, since blocking the budget’s approval could have consequences on the objective to reduce public deficit and on meeting the targets imposed by the EU. Cristóbal Montoro argued that, since the blocking would “only last some 30 days”, there is no such danger.

PP is considering blocking Catalan Government’s budget for 2014

December 16, 2013 08:09 PM | ACN

The People’s Party (PP) – which runs the Spanish Government – has announced it is looking at the possibility of freezing the approval of the Catalan Executive’s own budget. They are considering blocking the €29.31 billion budget because it will allocate €5 million (0.017% of the total spending) to a “citizen consultation”. The approval of such a budget is essential to meet the 1% deficit target for 2014. However, the PP fears this money could be used to organise the self-determination vote in 2014. The PP’s leader in Catalonia, Alícia Sánchez-Camacho, has announced she was talking with the Spanish Finance Minister, Cristóbal Montoro, on blocking the budget’s approval. The CiU, running the Catalan Government, has stated it is “a mistake”.

Controversial historical symposium begins by praising Catalonia’s affection towards Spanish society

December 12, 2013 03:16 PM | ACN

An enormous controversy has been raised around the academic symposium ‘Spain against Catalonia: An historical overview (1714-2014)’ that kicks off this Thursday in Barcelona. At the opening session, the Catalan Minister for the Presidency highlighted the “great affection” that Catalan people feel “towards Spanish society and its plurality and richness”, but not towards “the Spanish State and its institutions”. Furthermore he pointed out that the symposium does not aim “to impose anything”, but “to offer arguments” while “knowing that one single truth” does not exist. The event aims to reflect on the political, economic, social and cultural repression that the Spanish State has inflicted on Catalan people and institutions over the last 300 years. Prestigious university experts will give lectures on specific issues. However, the People’s Party, which runs the Spanish Government, and two other Spanish nationalist parties took actions aimed at cancelling the event.

Spanish nationalists want to close an academic history symposium in Catalonia

December 11, 2013 05:33 PM | ACN

With the title ‘Spain against Catalonia: an historical overview (1714-2014)’, this academic symposium aims to discuss the political, economic, social and cultural repression the Spanish State has carried out against Catalan institutions and people throughout the last 300 years. The event will offer more than 20 lectures given by prestigious university chairs. It is organised by Catalonia’s Science and Language Academy (IEC) and by the Centre of Contemporary History of Catalonia, which is linked to the Catalan Government. The symposium has raised controversy with its title. The People’s Party (PP), which runs the Spanish Government, has made cancelling the event a condition for holding a dialogue with the Catalan Executive. Furthermore, the PP, the anti-Catalan nationalism Ciutadans (C’s) and the Spanish nationalist and populist UPyD have filed a complaint against the symposium for “spreading hate”. Paradoxically, UPyD compared the symposium with “Nazism”.

Catalan Government’s budget for 2014 to have a 1% deficit, more social spending and further privatisations

November 5, 2013 11:40 PM | ACN / Gaspar Pericay Coll

The Catalan Government has presented its budget proposal for 2014, which posts a 1% deficit, representing a 35.5% annual reduction and amounting to €1.98 billion, in line with the 2014 deficit targets imposed by the Spanish Government. The budget prioritises healthcare, education and social policies, which represent 71% of the total non-financial spending. Non-financial spending grows by 0.2% and reaches €20.30 billion, while the total spending amounts to €29.31 billion. The Catalan Finance Minister stressed that spending had not been reduced this year since in the last 3 years it had already dropped by 22%. Budget cuts “have reached their limit”, as otherwise “social cohesion” and “the Welfare State” would “be at risk” he said. In 2014 the Catalan Executive will spend the same per inhabitant as it was doing in 2004 taking into account inflation (€1,901).The adjustment for 2014 focuses on increasing revenue by €3.2 billion, mostly through new taxes (€910 million) and the sales of assets and privatisations (€2.32 billion). On top of this, the Catalan Government forecasts a 0.9% economic growth for 2014, leaving behind the recession of 2012 (-1.2%) and 2013 (-1.1%).

Baden-Württemberg Vice President: “It’s up to the Catalans to decide if they feel better in Spain or on a stand-alone basis”

October 1, 2013 09:52 PM | Laura Pous / Albert Segura

Nils Schmid, Vice President of Baden-Württemberg and regional Minister for Finance and the Economy, said in an exclusive interview with the CNA that Catalans are the ones who have to decide whether they want to remain within Spain or to become independent. This process should “of course […] be based on a referendum”. The Leader of the Social-Democrats (SPD) in this state also added that his party is proposing to include the possibility of holding referendums at national level in Germany, which is currently not envisaged by the German Constitution. However, he “cannot imagine” an independence referendum for Baden-Württemberg. On other issues, Schmid pointed out that “fiscal consolidation is not enough” and has to come with “structural reforms” and policies to stimulate growth. He also welcomed Catalans who are going to Germany to find job opportunities.

1,060 companies moved from Catalonia to Madrid for tax reasons since 2010, according to Madrid’s Government

August 19, 2013 10:13 PM | ACN

In the last three years, 1,060 companies have moved their headquarters from Catalonia to the region of Madrid, according to a report published by Madrid’s regional Government. The report states that most of them took the decision because of the lower taxes that exist in Spain’s capital, compared to other areas such as Catalonia. Since 2010, 5,000 companies based in the rest of Spain decided to move to Madrid; 21.4% of them were from Catalonia. Paradoxically, 43 cents out of every euro paid in taxes in Catalonia is to pay for investments and services made in other parts of Spain, which turns into an annual fiscal deficit of 8.5% of Catalonia’s GDP, meaning that Catalans are obliged by the Spanish Government to give away €16.5 billion. Meanwhile, the Catalan Government is under-budgeted and obliged to implement severe budget cuts and raise taxes to balance the budget.

The Spanish Government imposes a 1.58% deficit target for Catalonia and €2.6 billion of further budget cuts

July 31, 2013 11:38 PM | ACN

The Catalan Finance Minister, Andreu Mas-Colell, accuses the Spanish Government of “asphyxiating” the Autonomous Communities. The 1.58% deficit target imposed to the Catalan Government represents €2.6 billion of further budget adjustment compared to last year’s budget, which ended with a 1.96% deficit. Mas-Colell denounced that the Spanish Executive is “keeping for itself the greatest share of the deficit pie”, while it is only responsible for 50% of Spain’s public spending. The Spanish Government is setting itself a deficit target of 5.2% for 2013 and most of the flexibility allowed by the European Union, which authorised a 6.5% deficit for Spain’s total public sector. Meanwhile, the Autonomous Communities have a deficit target 4 times stricter, although they manage 36% of Spain’s total public spending as well as basic services such as healthcare and education.

Catalonia is the 3rd Autonomous Community paying the most and the 10th in amount of funds received from the Spanish Government

July 11, 2013 01:28 AM | CNA

The Catalan Executive has published the liquidation of Spain’s fiscal redistribution scheme of 2011. That year, Catalonia was the 3rd Autonomous Community paying the most taxes per citizen in Spain, with a 119.1% rate if the average were 100%. However, after the Spanish Government’s redistribution of money through services and investments, Catalonia was the 10th territory in spending per capita, with a 99.4% rate, below the average. In 2011, Catalonia received €16.91 billion, 3% less than in 2010. The region of Madrid was the Autonomous Community paying the most, since Spanish Government bodies and many multinational companies are based there. It was followed by the Balearic Islands, which received 12.3 million tourists while its population is just 1.1 million.