Keeping taxes, independence conflict convention, Ministry of Catalan: ERC-Socialists presidency deal

Pro-independence Esquerra Republicana (ERC) and the Socialist Party have reached a preliminary agreement to support Socialist leader Salvador Illa’s bid to be named president of Catalonia.

The much-anticipated deal was announced on Monday evening, which followed on from months of uncertainty after the inconclusive May election, in which the Socialists won most votes and seats, but fell short of a majority. 

The deal includes stipulations for "economic solidarity" that ERC has been demanding for months. As part of it, according to ERC sources, the Catalan government will gradually collect "100% of the taxes" paid in Catalonia, and thus exit the “common regime” of centralized Spanish tax collection. 

However, the deal is only a preliminary one, as the text will be ratified or rejected by the rank and file members of Esquerra Republicana through a consultation on Friday. 

Meanwhile, the Executive Committee of the Socialist Party has approved the pre-agreement with ERC and has committed to bringing it into effect.  

Sources from the party have let it be known that the Socialists will also push forward with the points of the deal that depend on the Spanish government.

Collection of taxes

The party did not make the text of the deal public, but instead explained details of it in a press conference on Monday evening. Party official Raquel Sans called the agreement an "advance in a very determined way towards fiscal sovereignty." 

According to Sans, the tax agency of Catalonia will progressively "collect, settle and inspect 100% of the taxes," excluding municipal taxes, but instead using as examples personal income tax, VAT, and corporation tax.

"We are talking about the collection of 100% of taxes, that Catalonia will pay the state for the services it provides, and that we will pay a solidarity fee as long as we are not independent, which will be set transparently and clearly," Sans detailed.

The pre-agreement foresees that the fiscal changes will take effect in 2025, after everything is formalized in the first semester of the year in a bilateral commission between the Catalan and Spanish governments. 

The pact also outlines that as long as the new financing model is not yet in place, there will be a "substantial increase in resources" to compensate for "imbalances" in the current model.

On the other hand, ERC and the PSC have also agreed to create the Airport Authority of Catalonia and to amend the law to create a new Airport Governing Council of Catalonia. In addition, they have pledged to push for legislation to raise taxes on casinos.

Convention on political conflict 

The deal also foresees the creation of a National Convention for the Resolution of the Political Conflict, a table of all parliamentary parties which will have an objective of resolving the independence question. 

The body will be presided over by Esquerra Republicana, who say "it is time for the party that won the elections to say what proposals it has."

Department of Catalan language

The parties have also agreed to create a new linguistic policy ministry to ensure that "policies relating to language sit at the big tables." 

The agreement also foresees strengthening the language in the audiovisual sector and "shielding" the school immersion system from the "judicial offensive."

The Catalan school immersion system means that classes are taught entirely through Catalan to ensure that pupils leave education with high proficiency in both languages, with the argument being that Spanish is more commonly spoken in society in general.