January 28, 2021

The Government raises the highest tax increase since 2012

The Government raises the highest tax increase since 2012

The Government of Pedro Sánchez intends that the Public Administrations spend in 2019 the enormous figure 472.660 million euros, 5.1% more than in 2018. As expected a deficit of 1.2%, which would be about 15,000 million euros, needs to bring resources for a total of more than 457,000 million euros.

To achieve them, it has no other way than a generalized increase in taxes, the largest since 2012. This increase, despite what the Government alleges, will affect the vast majority of taxpayers, directly or indirectly. Minister María Jesús Montero, in the presentation of the large accounts of the State, boasted that the tax burden will increase to 35.5% of GDP, without raising taxes to "the middle class, workers with lower incomes and the self-employed, between others". It is not, far from it, accurate.

The increase in the contribution bases to Social Security, both those that employers must pay, as those that correspond to the workers, supposes an important tax increase – in some cases as in the Minimum Wage, the government's star measure – of up to 22%, what happens is that it is more or less hidden among the tangle of the quotes.

That allows Social Security revenues reach 140,256 million euros, 7% more than the previous year, a rise that also affects the autonomy, to which with the incentive of a new right to unemployment -as we will see under what conditions- the contributions are raised. It may not be the main tax increase of 2019, but it is among the most important, with the aggravating circumstance that for the vast majority of taxpayers it is camouflaged.

The Government, according to Minister Montero, advances that for the Spanish Welfare State to be closer to those of the more advanced countries, it is necessary to reduce the gap that exists between the Spanish fiscal pressure, now at 34.5%, compared to the average of the euro zone, of 41.4%. That means an advance announcement of new-and large-tax increases, although the head of the Treasury draws the details. Instead, it evokes a phrase of Pedro Sánchez: "We can not have a Welfare State of the first with a third income". The argument is weak. The Spanish tax burden is lower because so is the country's wealth, although Spanish tax rates are among the highest in Europe in almost all taxes -except in VAT- as numerous independent reports show.

The tax increases announced by the Government, beyond the camouflaged social contributions, are concentrated in several points and many of them, in addition to collecting, pursue popular. That is why the IRPF of the so-called "rich" will rise. Those who earn more than 130,000 gross euros will pay two more points and four who exceed 300,000. Scarcely 500 million more will be raised, but the government allows it to boast of counting the "rich". In addition, it consolidates the application of the Patrimony Tax. Until now it was temporary and extraordinary. Now it will be permanent and ordinary, although it is a tax virtually eradicated throughout the world. The lion's share of the rises will correspond to the companies, with a minimum rate of 15% for large companies, 18% for banking and hydrocarbons and a 5% reduction in dividend deductions. The minister says that only affect 0.7% of large corporations, but there are about 10,000, the only with important staff, which have already begun to reduce. The Government will also approve two new taxes, the one on financial transactions and the so-called «Google» tax, without forgetting that, for individuals, diesel will also rise. In short, a general increase in taxes, the most important since 2012, which will affect the pockets of most citizens and, what is worse, they do not know it.


Source link