The chapter that occurred in Italy last week is a clear warning to sailors. The taxation of a country is not a Monopoly game so that politicians without a job or benefit and who play house with the country’s money try to take from here and there, mistakenly thinking that governing basically consists of managing taxes, as if it were a Nottingham sheriff in the Robin Hood era.
Taxes are very serious. The taxation of a country is regulated by laws and regulations and is part of something called the legal framework. The legal framework of any territory is the set of rights and obligations of people, companies and institutions for their coexistence and, in the economic field, for their financial and business decision-making.
In the same way that a soccer referee cannot change the rules during the game, a ruler or a party in office cannot and should not modify certain fiscal rules that seriously affect the economy or its economic agents. That’s what FIFA is for. If after a long time and a detailed analysis it is decided to modify a certain rule, it will be analyzed and decided among a wide group of sports experts before making a decision. And then both the date of inclusion of the new standard and the time for adaptation and notice to the players and coaches will be planned.
In tax matters, it should be the same. There are taxes that must remain unchanged for years because they are part of the legal framework that has led investors and businessmen to risk their money in the country. Remember how we behaved with subsidies and exemptions for renewable energy years ago. They were eliminated with a stroke of the pen, leaving international investment funds with a span of noses, who swore they would never return to Spain. The taxes on which long-term investments depend cannot be changed every time an upstart prime minister comes around.
Long terms should be agreed in which, except in cases of force majeure, a tax cannot be altered (we are talking about terms of five to ten years), qualified parliamentary majorities to do so and start-up periods sufficient to give investors time to make decisions based on the planned modification.
Last year, four new taxes were approved in Spain and the tax rate of another seven was modified. Almost a new tax per month. As in the series, no one lives here. The World Bank placed Spain at the bottom of the EU in terms of legal certainty. It doesn’t surprise me. But the Meloni thing is a warning. The world is global, and a mere prime minister can’t do whatever he wants with our taxes.
