September 22, 2020

“Raising taxes is not the right way”




Ignacio Garralda, President of Mutual Madrileña, He has not hesitated to send the government his message of rejection of the tax increases. It has done so during the 2020 mutual meeting, where it has not minded its claims to the Executive in a “very complicated” environment.

“Although everyone agrees that increasing investment is essential to support the economic recovery, I do not think that the right way is to increase the fiscal pressure at the moment in order to obtain the necessary resources to help the sectors in crisis”, has pointed out during the conclave. The leader even dared to recommend Pedro Sánchez a possible line of action to increase tax collection without having to increase taxes. Its formula is to reinforce the fight against tax fraud and try to bring out the shadow economy, “which in our country still has too great a weight.”

However, these have not been his only darts at government, and the political class in general. While acknowledging Spain’s difficulties in overcoming the “hard blow” of the CovidGarralda has denounced that the problems of our country are aggravated “by political uncertainty and the lack of consensus on fundamental matters.” The latter, together with plans to raise taxes, causes in his opinion a negative impact on business investments.

Beyond this, the President of Mutua has emphasized the need to urgently tackle two structural reforms: in education and pensions. “Statistics and demographic studies show that the current (pension) system is not sustainable,” he said, to report immediately that “It is extremely irresponsible not to recognize the seriousness and dimension of the problem”.

Business evolution

Garralda has also influenced the good development that its international expansion is having, even despite the macroeconomic difficulties that have been dragging since 2019 and now with the crisis of the Covid affecting all sectors of activity.

In this sense, it has highlighted the good progress of the alliance with Bci Seguros, the Chilean insurer that it entered in 2016 and in which it has just exercised the purchase option to expand its participation in the firm up to 60%. The return on investment, according to the company, was 17.8 million in 2019, 8.2% more year-on-year.

Its international presence also expanded last year with its entry into the Colombian State insurance with 45% of the capital. And the prospects are to continue in this line of expansion. In Garralda’s opinion, to guarantee sustainable development in the future, one must also look abroad. For this reason, the company will continue along this path, whenever business opportunities arise.

Likewise, at the mutualists’ meeting, the president revealed the company’s price containment policy in 2020. Mutua will again freeze the premiums for almost 50% of car policyholders this year, that is, around 900,000 mutualists . In addition, the firm will extend coverage to 14 months instead of 12 to mutualists that were part of the company before Covid in auto or motorcycle insurance, due to the economic crisis and the low loss ratio recorded during the state of alarm. A million of them have already benefited from this measure, Garralda said.


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