The banking and the energy sector revolt en bloc against the Government’s intention to perpetuate the “tax”. The AEB and CECA, the main employers’ associations in the financial sector, yesterday expressed their “most energetic” rejection and warned that it would harm investment, the economy and employment, with the risk of reducing financing capacity by 50 billion. In parallel, the Spanish Association of Petroleum Products Operators (AOP) warned that it could “discourage investments in the country”, putting in jeopardizes the 16 billion that the sector plans to dedicate to its decarbonization until 2030. “It would compromise the competitiveness of the industry and make the energy transition process difficult, negatively affecting the entire value chain,” warned the employers’ association, which includes large oil companies such as Repsol, Cepsa, Galp and BP, among others.
The president of the CEOE, Antonio Garamendi, warned that the obstinacy to make them permanent leaves “in limbo” billions of euros in future investments. “If we want companies to invest and be competitive we have to make money,” he said and warned of the damage to the industry “if taxes are imposed a la carte.” From the employers’ association of the Feique chemical industry, its general director Juan Antonio Labat added ingredients to the complaint and controversy, by pointing out that the poor design of the tax has forced companies suffering losses to pay it because it is applied to income and not to results, in direct reference to Cepsa, which suffered a charge of 244 million despite registering 233 million in the red.
Repsol’s “pulse”
The en bloc rebellion comes after Repsol has taken action, moving the development of a green hydrogen project to Portugal after it warned at the time that it would relocate investments if the tax became indefinite. The multi-energy movement has, in fact, torpedoed Moncloa’s intentions to perpetuate both taxes by getting Junts per Catalunya to oppose any initiative that threatens investments in Catalonia.
The Executive’s intention was to undertake the fiscal change by amending the regulations processed by Congress to set the minimum taxation of multinational groups and large corporations at 15%, but Junts’ position would prevent it from being carried out, which has forced it, For now, to delay its vote by extending the period for presenting amendments to the 30th.
The situation yesterday forced Government to admit that it will have to give up maintaining temporary taxes to energy companies and banking If it does not obtain the necessary parliamentary support, although at the moment he is not throwing in the towel and is hoping to “convince of the benefits of asking for greater effort from those who have had greater benefits,” according to what he reported. Efe.
The PNV also added tension to the process. His spokesman in Congress, Aitor Esteban, expressed fear that the tax on energy companies ends up scaring away investment from the affected companies. The PNV could accept the change if it is established as a tax within the Basque agreement, which would allow the regional government to modify the tax rates or subsidize them, something that, with the current figure (non-tax public property benefits), it cannot do.
Vice President Montero has hoped to be able to overcome the discrepancies, also with Junts, with whom she believes that an opportunity for dialogue will open once her political congress is held this weekend. A formulation that seems to have been considered is that, Instead of taxing the income of energy companies, the tax applies to gross profit or to the operation, including as an incentive its exemption for investments made in Spain, something that would make it possible to square the circle of promoting projects in the country or paying taxes.
From the bench, the AEB and CECA criticized that Spain will be the only country with such a taxsomething that represents a competitive disadvantage for the entities and goes against the recommendations of the European Central Bank (ECB) or the International Monetary Fund (IMF) that advocate keeping these resources within the entities so that they reinforce credit to companies and families.
For the sector, it makes no sense to perpetuate a tax that was justified by the “extraordinary” results obtained with the rate increases when they are now falling and the Euribor is today lower than what existed when the tax was born. The Spanish Institute of Analysts also warned that it would be “especially harmful” for SMEs, by not taking provisions into consideration, a charge that is particularly onerous on their credits.
The Government admits that without support it will decline
“If the Government does not have a sufficient majority, it will not be able to ensure that these taxes remain over time,” acknowledged the first vice president and Minister of Finance, María Jesús Montero, although she hopes to “convince” the parties of the “goodness” of continuing with the taxes. On the other side and in the face of Junts’ reluctance and PNV, Sumar claims to perpetuate them because banks and energy companies “practically do not pay” Corporate Tax. Both sectors pay 30% of this tax, compared to the 25% set for the rest of the companies.
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