What, at first, seemed like it was going to be a bill with which the Government was going to approve a minimum tax of 15% on large multinational companies ―as mandated European Union― has ended up becoming a fiscal catch-all. Through agreements between the PSOE and several of its allies, amendments have been introduced in the final text that have transformed the application of the European directive into a kind of tax reform.
What is being debated this Thursday in Congress has its complexity, although it can be divided into two blocks. On the one hand, we vote on opinion of the Finance Commissiona text that incorporates several amendments on tax matters promoted by different groups, although registered by the PSOE. On the other hand, there is another series of amendments that did not achieve sufficient support to be incorporated into the text that came out of the commission and that they remain alive for independent voting in the Plenary.
First of all, two questions. First: is the successAt least, of the text that was agreed upon in committee? No. Second: why did this text have support in committee and is it possible that it does not have it in plenary? Fundamentally, due to two factors. The first, the four deputies of Canwho do not have a presence in the commission, and could overthrow the package by voting in the opposite direction to the one that did so Nestor Rego (BNG), the deputy who represents the Joint Group in the commission. The second, changes that may occur due to negotiations that are still open between the Government and its allies.
What is clear at this point is that PP, Vox and UPN (171 seats between the three) will vote against everything. For its part, PSOE, Add, CKD, Together, EH Bildu, PNV, BNG and the independent deputy José Luis Ábalosif there are no last-minute twists, they will vote in favor, at least, of the commission’s opinion. There are 174 supports. It remains to be seen what role Podemos ends up playing. Regarding the amendments that remain alive and that they are voted separately there are more doubts. Among them is the bank tax.
What does the text agreed upon by the commission include?
Last Monday, in the kilometer Finance Commission that lasted until past one in the morning, PSOE, Sumar, ERC, Junts per Catalunya, EH Bildu, PNV and BNG approved the text that will be voted on this Thursday. What does it include?
The basis of the bill is the imposition of a 15% minimum tax to multinational companies. There is agreement on that. Furthermore, it is a European directive to which Brussels is obliged. However, when going in conjunction with other fiscal measures – the amendments that were incorporated -, could end up declining. This Thursday is one of those days when nothing is certain.
Among these amendments, one of the most relevant has to do with the increase of two points ―from 28% to 30%― in the taxation of personal income tax to higher incomes. This is an agreement reached by PSOE and Sumar and that had the support of Esquerra and EH Bildu.
Within the text a tax reduction for SMEs (up to a turnover of 10 million euros) or micro-SMEs and an improvement in the tax burden for artists. It is a measure that is also part of the agreement signed by PSOE and Sumar and that implies a tax reduction for actors, dancer musicians and other artists, audiovisual or auxiliary workers. They would be reduced maximum 30% when they exceed 100,000 euros and up to a maximum of 150,000.
There was also a vote in favor of introducing into the commission’s final opinion a series of deductions for recapitalization of companies of any size and an extra tax burden on various activities related to tobacco companiesamong them, for vapers and other forms of nicotine consumption.
The package also includes a reform, which at the time promoted the popular Christopher Montoro but that was knocked down by him Constitutional Court (TC), of the corporate tax that sets limits on companies’ deductions and their compensation for losses. In addition, changes will also be approved to avoid fraud of hydrocarbon companies in the deduction of VAT.
Live amendments (special attention to the bank tax)
Thus, all these measures will be voted on as a whole. But there is another group of amendments that reach the Plenary alive because they did not get the necessary votes in the Finance Commission. This is what is known in parliamentary jargon as “amendments alive“. In this case, the most controversial is the banking tax.
Both this tax and the energy tax are two extraordinary taxes that decrease, in principle, the December 31. For this reason, much of the negotiation in recent weeks has been based on the possibility of maintaining them, which is what the left-wing parties in the Chamber are pursuing. Initially, ERC, EH Bildu and BNG rejected a commission ruling that did not include keeping both taxes active. Finally, the three groups agreed with the Government to extend the energy companies’ agreement for one year through the Royal Decree-Law.
Therefore, this extension is not voted on this Thursday. However, it is the agreement that unstuck the negotiation in committee.
He bank taxHowever, it will be voted on. What is not known is whether the transactional amendment that the PSOE introduced incorporating any request from ERC, EH Bildu and BNG – basically, increasing the highest bracket of the tax – and that declined in commission is maintained Viva or if the one that ends up being voted on is another amendment that the Socialist Party registered and agreed with Junts in similar terms, but whose content does not convince the left.
Two amendments that Sumar agreed upon with the PSOE and that, surprisingly, the socialists ended, will also be voted on. voting against in the Commission: end the tax advantages for Listed Real Estate Investment Companies (SOCIMI) and increase the tax burden on private health insurance. In Sumar there is great discomfort due to the ugly what the PSOE did to them and they rule out that neither of the two measures can go ahead.
Finally, amendments will also be debated to equalize the tax on diesel and gasoline or to raise VAT on tourist flats.
As confirmed Publicthe Government is rushing to try to move forward this Thursday the broadest possible fiscal packagealthough the truth is that the success of the text approved last Monday in the Finance Commission is not even assured.
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