The governor of the Bank of Spain, José Luis Escrivá, has requested that the new design of the banking tax avoid penalize certain types of “somewhat riskier” business such as credit to SMEs, which requires greater provisions compared to loans to large companies.
This was stated in his first appearance at the Economy Commission of the Congress of Deputies since his appointment in mid-November. It is worth remembering that the Lower House approved this Thursday a tax reform that includes a new design of the sector tax that includes a progressive rate that taxes interest margin and net commissions of up to 7%.
He recalled that it is the European Central Bank (ECB) that has to give its opinion on the tax, as it already did in November 2022 with the previous design of the banking tax, although the Bank of Spain could have been requested. a contribution in this regard, something that has been pointed out “has not been the case”.
Although he has not gone into assessing who to tax, how to tax and how wealth is redistributed, a question that depends on the legislator, Escrivá has indicated that he can address the question of what he considers desirable so that the tax “does not have unwanted and unintended effects” by the legislative power itself.
It is that moment in which he remembered the bank’s request that does not affect businesses that may be considered higher risksuch as credit to small and medium-sized companies, which have fewer options for accessing financing than large companies, but which have a greater risk of non-payment.
“Given that it is a somewhat riskier business, banks make more provisions and, therefore, in the provision part there is more cushion for that risk. It is desirable that, in the design of a tax of these characteristics [que grava los ingresos de la banca] net of the provisions below, regardless of the aggregate collection capacity, which is totally legitimate,” he told the deputies present in the commission.
He has also pointed out that one should be “careful” with the issue of tax progressivitywhile asking that certain investments that Spanish banking entities have to undertake, such as technology issues, are not penalized by the tax either.
“This leads us to think about a tax base that is more oriented to a lower part of the cascade [es decir, de la cuenta de resultados] than above. I believe that these elements do not question at all what a certain sector wants to be taxed, where it is difficult for us to enter, but it is advisable to take us into account so that the design of the tax does not have unintended effects,” he concluded in this regard.
BBVA takeover bid on Sabadell
Asked by the deputies about the possible banking concentration and the relationship of this issue with the takeover bid that BBVA wants to launch for Sabadell, Escrivá has shown himself to be prudent and “respectful” with the distribution of powers between supervisors.
He has indicated that among the functions of the Bank of Spain [“y mira que tenemos funciones, hasta once identificadas”, ha comentado] There is no competition analysis that in Spain depends on the CNMC and at the European level, on the European Commission directly.
“What we [el Banco de España] What we have done is transmit all the information that the national and European competition authorities have requested of us. But it is very difficult, when you have a colleague at your side who is responsible for competition, to speak out, honestly,” he stated.
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