regional government

Catalan minister Damià Calvet and Barcelona mayor Ada Colau are in New York this week

Catalonia’s main SME association PIMEC and the Catalan Business Circle (CCN) have criticised the regional Government of Madrid for issuing a report not sufficiently backed-up by economic data. In addition, they have accused Madrid’s Finance Minister, who presented the report, of offering a politically-biased version by saying that companies have left Catalonia due to the self-determination debate. PIMEC and CCN stated they do not have data supporting Madrid’s statement. On the contrary, they have data proving that foreign investment has not reduced. In addition, CCN accused the Spanish Government of building a “Greater Madrid” as an economic centre, at the expense of other areas such as Catalonia. PIMEC emphasised the Catalan industrial tradition and the vigour of its economy, although admitted that taxation is higher in Catalonia than in Madrid.

In the last three years, 1,060 companies have moved their headquarters from Catalonia to the region of Madrid, according to a report published by Madrid’s regional Government. The report states that most of them took the decision because of the lower taxes that exist in Spain’s capital, compared to other areas such as Catalonia. Since 2010, 5,000 companies based in the rest of Spain decided to move to Madrid; 21.4% of them were from Catalonia. Paradoxically, 43 cents out of every euro paid in taxes in Catalonia is to pay for investments and services made in other parts of Spain, which turns into an annual fiscal deficit of 8.5% of Catalonia’s GDP, meaning that Catalans are obliged by the Spanish Government to give away €16.5 billion. Meanwhile, the Catalan Government is under-budgeted and obliged to implement severe budget cuts and raise taxes to balance the budget.

Aguirre, President of Madrid's regional government, asked to return healthcare, justice administration and education powers, which are managed by the Autonomous Communities, back to the Central Government. Prime Minister Rajoy, the leader of the People’s Party (PP) –Aguirre’s party–, stated that a debate about the Autonomous Community model is “out of the question”. Furthermore the PP’s Catalan leader defended the current model, as Catalonia “exerts its self-government as established in the Constitution”. Besides, the Catalan President told Aguirre to return the powers she does not want to manage, but to leave Catalonia aside. He added that the current model was designed “to dilute Catalonia and the Basque Country’s self-governance claims”.