Financing and the precipice

Catalonia knows very well the cost of euphemisms and the value of the principle of reality. Therefore, when negotiations on the financing system emerge, it would be appreciated to use precise and unsweetened words. Personal Income Tax (IRPF). Negotiation sources speak of "laying the foundations for a unique model for Catalonia that can be generalized to the rest of the regions." It is not necessary. The details, always devilish, will have to be read, but it could be a step forward within the framework of the current reality, which is susceptible to deteriorating significantly and rapidly. The main virtue of the system is that it will address revenue and not just expenditure, and that it will guarantee the principle of effective ordinality at the end of all calculations. It will not only address the direct collection of taxes. For decades, Catalonia has been demanding not only more money but also the ability to decide how it manages it and what priorities it establishes in spending. Catalonia has more room for action in a global context where competition between regions and countries is increasingly acute. Solidarity, how the legislative reform of the LOFCA and the financing laws of the autonomous communities and Catalonia will be implemented. The benefits of Madrid's capital status, which allows it to do so, will be offset. dumping fiscal at the expense of the rest of the territories? Will sufficient funding be secured for all powers, especially those that are not homogeneous?

Among the most complicated issues to negotiate, which are still open today, is the development of the Catalan Tax Agency. Experts speak of a development period of about five years before collecting all personal income tax, and politically, no one dares to specify whether there will be a shared platform between the two agencies. For now, the negotiations sound like a statutory consortium and the sharing of taxpayer data.

The future of the negotiation of the financing system cannot be isolated from the instability of the political situation. If legislative reforms are not implemented quickly, they will once again become bogged down in the mud of Madrid politics, threatened by an early election. To reach an agreement on the legislative reform, eight parties will be required, including the Valencian Compromís party, which is experiencing a dire liquidity crisis and needs to be able to join the reform. Therefore, a lot of backroom negotiation will be necessary with Sánchez's investiture partners.

Above all, we will have to see how the Spanish government's health evolves, besieged by the Cerdán case and gripped by the fear of new revelations that could turn what is currently a corruption case into a case of irregular financing of the PSOE, as the judge seems to be seeking. Pedro Sánchez emerged from the appearance in Congress unscathed thanks to his fear of his partners and the leader of the opposition. Feijóo is incapable of building bridges with potential partners and mocks them by throwing himself into the arms of Vox, a strategy that does not seem the most intelligent for obtaining a majority that will take him to the Moncloa. Without alternative proposals and squandering what could have been, in practice, a vote of confidence, the PP is playing only with the harshness of breaking the legs of its opponent and his family, as if, in addition to the asset declaration, politicians now have to present the moral credentials of their father-in-law.

In a very tense session, the investiture partners saved Sánchez. Approaching the threshold of the precipice, eyeing the height of the fall into the void and calculating the violence of the impact, they all preferred to look the other way and continue down the steep path, even if it is difficult. It is in this context that financing is being negotiated.