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Catalonia’s net contribution to Spanish redistributive fiscal system up to 5% of its GDP

Some €9.9 billion was allocated to compensate Spain’s regional economic imbalances in 2014, according to Spanish Tax Ministry

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08 September 2017 09:10 PM

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ACN | Madrid

Catalonia’s net contribution —that is, the fiscal deficit, or difference between the amount it pays into Spain's coffers and what it gets back in spending— to Spain's fiscal system increased to €9.892 billion in 2014, according to data published by the Spanish Finance Ministry on Thursday. The input accounted for more than 5% of Catalonia’s GDP at the time, and cost each Catalan citizen €1,317.

Spanish figures show the imbalance has increased in recent years. In 2012, Catalonia contributed €7.7 billion more than it received back, which accounted for 3.9% of its GDP at the time. The following year, Catalonia’s fiscal deficit increased to €8.8 billion, more than 4.5% of its economy.

  • Catalonia is the second largest net contributor to Spanish finances, surpassed only by Madrid

Catalonia is the second largest net contributor to Spanish finances, surpassed only by Madrid (€19.2 billion) and followed by Valencia (€1.7 billion) and the Balearic Islands (€1.5 billion). All other regions whose finances are controlled by Spain’s central government — with the exception of the Basque Country and Navarra, which manage the tax system on their own — are net beneficiaries. Andalusia, Spain’s most populated region, is the largest recipient (€7.7 billion).

Different estimates

The Spanish treasury follows a cash-flow approach to measure the redistribution imbalances, which divides the expenditure that is thought to benefit all citizens among all regions regardless of where the investment is made (for instance, the royal family, the army or the embassies).

According to estimates published by the Catalan government in 2016 — which indeed took into account where the investments are made — Catalonia's fiscal deficit in 2012 was €14.6 billion, or 7.5% of its GDP.

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  • Spanish Finance minister Cristobal Montoro (by ACN)