Personal income tax collection in Catalonia: ERC will revive its proposal for a vote in Congress in February

BarcelonaThe negotiations on the financing model are far from over. This Friday, the Minister of Finance presented the general financing model for all autonomous communities, including Catalonia, but the negotiations with the Republicans have several key aspects for them, the main one being Catalonia's tax collection capacity, specifically personal income tax (IRPF). In this regard, according to Republican sources consulted by ARA, Oriol Junqueras's party intends for its proposal to transfer powers to the Generalitat (Catalan government), which is currently being processed in Congress, to be voted on at the end of February. They want to do so using their quota as a parliamentary group in the Spanish Parliament, as this ensures that at least a first step is taken. This is the same proposal that the Republicans announced in the summer to put pressure on the PSOE (Spanish Socialist Workers' Party) and which they put on hold this autumn to reach the agreement on the financing model for the autonomous communities that Montero detailed today. For now, as Junqueras acknowledged after the meeting with Spanish President Pedro Sánchez, there is still no agreement on tax revenue, but sources consulted expect to narrow the gap in the coming weeks. However, sources at the Treasury are not optimistic: "It's a major obstacle," they say, asserting that ERC needs to reconsider its position. —Núria Rius Montaner reports.

According to sources familiar with the negotiations, talks are stalled on the bulk of the tax collection process that would be handled by the Catalan Tax Agency (ATC). The Ministry of Finance was only willing to cede 10% of these procedures to the Catalan government, while the Republicans are demanding to assume 90%. In any case, all parties agree that the process will have to be more or less shared because there is common information that both administrations need for efficient tax collection.

The legal architecture needed to advance in the collection of personal income tax is a "condition sine qua non"by Esquerra when negotiating the budgets of the Generalitat and the State. In fact, Junqueras himself has expressed it this way." at a press conference After listening to the Minister of Finance, María Jesús Montero, present the new financing model. A requirement, therefore, essential for the president, Salvador Illa, to have his first budget of the legislature.

However, to pass the law to transfer tax revenue to the Generalitat, the Republicans will need not only the approval of the PSOE but also that of the plurinational majority. That is, Junts should also support this vote, especially after the loss of José Luis Ábalos' seat, which has meant that the Spanish government has lost a vote: unlike the financing system (which Junts rejects), Carles Puigdemont's party could enter into negotiations on this matter with the Spanish government.

The development of the ATC

In any case, the collection of personal income tax (IRPF) from Catalonia will not be immediate. Beyond the fact that there is still no agreement between the PSOE and Esquerra and that the entire parliamentary process remains, the Catalan Tax Agency is also not prepared to assume these responsibilities immediately. Although Esquerra and the PSC agreed in their investiture agreement that everything should be ready by 2026, the Catalan government itself has already lowered expectations and admitted that it will not be prepared. to begin assuming its management until 2028.