"I feel more identified with the German chancellor than with the leader of the PSOE (...) for telling the Germans that taxes must be lowered." The phrase was pronounced by Pablo Casado this Tuesday before the main businessmen of the Spanish tourism sector, one day after the German head of government, Olaf Scholz, visited the Spanish president, Pedro Sánchez, at the Palacio de la Moncloa. The leader of the PP was thus trying to establish a parallelism between one of his main economic proposals, a tax reduction of 10,000 million euros, and the supposed policies of the chancellor. The problem is that the German plan to reduce 30,000 million in taxes is not such, at least not yet. The reduction of 30,000 million euros in taxes is, for now, a proposal by the German Finance Minister, the liberal Christian Lindner. In fact, Scholz spoke out against it on the campaign trail.
Sánchez and Scholz show the new "tuning" of Spain and Germany despite discrepancies in debates that will mark the future of the EU
The German government is a tripartite with the SPD at the helm as the most voted party in the September 2021 elections. The Greens, third force in the polls, hold the vice-chancellery, in addition to the Ministry of Economy. And the liberals of the FDP, who were the fourth most voted option, took over Finance. After a long negotiation they agreed a government program in which a specific tax reduction is not established, to the point that the chapter on fiscal policy starts with a declaration in favor of "fair taxes" as a basis for supporting State action.
The agreement does propose a fiscal policy to favor the economy in the midst of the coronavirus crisis, which could include reforming some taxes, and speaks of "eliminating double taxation" in the pension system, in addition to other proposals on fiscal matters. But no figure is set and no deadlines are specified.
In early 2022, Lindner gave an interview to the newspaper bild in which he announced that his idea is to propose a Tax reduction of up to 30,000 million throughout the legislature which included, for example, removing from the electricity bill the part intended to cover the transition to a renewable electricity system. In Spain, the Government has also reduced the tax burden that consumers pay on their receipt.
At the moment, the plan is nothing more than the proposal of the finance minister and president of the FDP. The 2022 Budget is already closed, so its implementation would not arrive until at least next year. In fact, the liberal leader speaks in the interview that he is preparing a "draft" of his budget project.
Today's chancellor was shown during the election campaign against a tax cut. "It's immoral," said the former Finance Minister during the last Angela Merkel government. In fact, Scholz pointed out that a reduction in that amount would mean cuts in the welfare state, when the central axis of his campaign is to increase the minimum wage in Germany. A proposal that is part of the tripartite government agreement.
What Scholz and Casado do seem to agree on is a horizon for bring back European tax rules, that is, to contain public spending and reestablish the austerity that was imposed in the economic crisis caused by the crash 2008 financial year. Pedro Sánchez, like Emmanuel Macron (France) or Mario Draghi (Italy), suggest that it be done gradually, while the northern countries, like Casado, prefer to speed up the process.