The regional Executive plans to include this measure in the 2023 Budgets
The trickle of autonomous communities that have adjusted their part of the IRPF (Income Tax) rate to mitigate the unstoppable inflation of recent months begins to pressure the Government to approve a similar measure for all the common regime territories (all except the Basque Country and Navarra). The Executive of the Region of Murcia has also joined the petition on several occasions. In fact, the regional government is preparing the personal income tax deflation that will be included, in principle, in the 2023 accounts.
Deflation makes it possible to reduce the impact of a hypothetical rise in wages among workers, as they are affected by a higher level of personal income tax than what they have paid until now. But the Ministry of Finance does not contemplate, for now, going down that path, according to government sources explained to this newspaper.
In the Executive they insist that “it is not a measure that allows lowering inflation.” In addition, they point out that it does not benefit the lowest or most vulnerable incomes “because they are already below the minimum taxation” in Income. For example, they indicate, for a worker who receives the minimum interprofessional salary, the deflation of personal income tax “does not benefit them at all.”
Treasury clarifies that to combat inflation “the selective reductions of the products most affected by inflation are much more effective.” In fact, this Tuesday the Council of Ministers approved the reduction of VAT on gas from 21% to 5%.
For now, there are three communities that have launched, or plan to do so: Andalusia, whose government council has approved deflation this Tuesday; Madrid, which has it in mind and has announced it; o Basque Country, where it has already been launched in the Executive of the PNV supported by the PSE.
On September 15, Congress rejected the PP’s proposal to adjust at least the first three sections of personal income tax for inflation. It is not the first time that the Lower House has refused to deflate this tax, since previously it had already rejected another Citizens proposal along the same lines.
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