Neither independence in 18 months nor personal income tax in 12

BarcelonaIn 2015, Junts pel Sí, a coalition led by Convergència i Esquerra (Together for Yes), promised the electorate independence within eighteen months, which implied (supposedly) the ability to collect taxes from Catalonia. However, ten years later, it is clear that in 2025, the Catalan Tax Agency (ATC) will not be able, due to its size and capacity, to collect one of the most important taxes for the public coffers, the personal income tax (IRPF). That the ATC was not ready was known by the government of Carles Puigdemont and Oriol Junqueras when they set the 2017 calendar, and so was Salvador Illa's government when it agreed with Esquerra (then led by Marta Rovira) that starting in 2026, that is, next year, the Hisenda (Spanish tax authority) would be implemented. But they didn't just know this: they must have also been aware that the PSOE wasn't ready to assume any special funding for Catalonia, at least not yet, as demonstrated this Monday in the Generalitat-State Bilateral Commission: because one thing is what is said, another is what is written, and, finally, what is done.

The Catalan and Spanish governments have saved the day with an agreement on a new financing model, but what the two executives have signed (in the official agreement of the Bilateral Commission) is not exactly what the PSC-ERC agreed upon for the investiture. It resembles it, but essential issues are left open for later, such as the principle of ordinality. –the State does not explicitly assume it and leaves it as a request from Catalonia in the preamble– and the collection of personal income tax and all taxes by the Generalitat. On this last point, the expression is ambiguous, since apart from subordinating it to a "working group," it is said that the Catalan Treasury "will progressively assume management responsibilities for personal income tax." What both governments did this Monday, then, is give themselves some leeway at a time when it is unclear in Madrid how long the legislature will last, and they have referred themselves to the Congress of Deputies and the Council of Fiscal and Financial Policy to solidify these concepts that could truly be innovative with respect to the current financing model.

The sequence with which the Generalitat and the State have planned the meeting has not helped to clearly explain to the public what has been agreed upon. To begin with, a briefing was convened at 9:30 a.m. with journalists to explain the foundations of the model, which was embargoed until after the Bilateral Commission concluded at 1:00 p.m. At this meeting, instead of providing the media with the text that had been agreed upon between the two governments (which had been negotiating for days), they were given a PowerPoint with a series of principles—such as solidarity, transparency, ordinality, self-governance...—that have not been fully reflected in the final agreement, especially with regard to ordinality. What's more: even after the meeting between the two governments and the pact having been staged, the official pact has not been delivered in writing to the media, so the press conference between the Minister of the Presidency, Albert Dalmau, and the Minister of Territorial Policy, Ángel Víctor Torres, was held without journalists having had access. A communication strategy aimed at avoiding awkward questions, especially because the PSC defends the principle of ordinality, which the PSOE has not yet explicitly embraced.

The right doesn't care.

With this Monday's agreement, the Spanish government avoids clearly marrying itself to a specific model for Catalonia, so it can try to soften the reaction that others may have. men of the PSOE and try not to cause excessive problems for the Minister of Finance and candidate for Andalusia, María Jesús Montero. However, the PSOE should also know, given its current legislative term, that whatever agreement it makes will seem like the end of Spain, according to the PP and some sectors of the State. As Isabel Díaz Ayuso and the Association of State Tax Inspectors have already demonstrated, by criticizing a pact that has yet to be finalized and without figures.