Constitutional Court overturns Catalan tax on Internet providers

Yet another Catalan law has been overturned by Spain’s Constitutional Court (TC in Spanish). In what seems to have become a regular occurrence, this time the court has ruled against the tax that the Catalan government wanted to put on Internet operators, which was intended to help fund Catalonia’s audiovisual sector.

Already this year, the Constitutional Court has overturned legislation relating to the use of the Catalan language in the audiovisual sector, education for newly arrived migrants and marketing. Meanwhile, in July, the TC also suspended part of the Catalan budget set aside to fund the October 1 referendum.

As in those cases, the latest ruling is in response to an appeal from the Spanish government, which argued that the Internet provider tax clashes with the sales tax that already exists on Internet connection services. The Catalan tax applied to operators providing electronic communication services, with a fixed quota of 0.25 euros a month on each contract supplying a connection in Catalonia. The Catalan government hoped to raise some 20.5 million euros a year through the tax.

Despite the ruling, five of the 12 TC judges cast individual votes expressing their disagreement with the decision, as they consider the Catalan tax to be distinct from sales tax.

The ruling is a setback for the Catalan government, which intended to use the bulk of the revenue collected to foster the audiovisual industry (95%), with the rest going towards publicizing digital culture (5%)