tax increase

On Wednesday the Catalan Parliament passed two important bills. With 74% support, it has approved the Law of External Action and Relations with the EU. Only two parties voted against it, the Spanish nationalist People’s Party (PP) – which runs the Spanish Government – and Ciutadans (C’s). A third party, the alternative left and radical independence party CUP, abstained because it considered that the law was not “ambitious enough”. All the rest supported the bill, which mainly puts in order the existing bodies and mechanisms, although it also creates some new ones, in line with the Catalan Government’s powers in this area, recognized by the Catalan Statute of Autonomy. The other bill is the tax on Internet suppliers, which aims to fund the Catalan audiovisual sector, affected by Internet piracy. No party voted against it. The new tax aims to collect some €20.5 million per year and it is welcomed by the cinema industry, and rejected by the main Internet suppliers.

The Cercle d’Economia, the main Catalan economic forum open to businesspeople and academics, has published an opinion note on the political context following the last Catalan elections. In the note, the Cercle asks the Spanish Government “to talk” about the Catalan self-determination and “to reform” the Constitution accordingly. The Cercle does not explicitly back an independent Catalonia but it supports a deep reform of Spain’s territorial organisation and the finding of a negotiated solution for both parties, which may be reached through a legal referendum. In addition, the Cercle asks for a review of Spain’s internal distribution of the deficit targets among government levels and to increase those of the Autonomous Communities.

The Spanish Finance Minister, Cristóbal Montoro, announced that the Central Government might heavily fine the governments of Autonomous Communities that do not meet the deficit objective. Montoro, from the People’s Party (PP), met with the regional governments run by his party to prepare a common position on the issue. On the same day, the Centre-Right Catalan Nationalist Coalition (CiU) gave its support to the Spanish’s Government decree to cut public spending and increase taxes, announced at the end of December.