The characteristics of the new “singular” financing system for Catalonia presented yesterday by the Minister of Economy, Natàlia Mas, only lists but does not detail or quantify the measures. Although the text runs for 85 pages, most of it is a description of the model’s current status.
How will taxes be managed?
Catalonia chooses to collect all taxes paid in the community, including corporate tax or VAT
What income do you expect to achieve?
The potential collection with the model is 52,000 million. It is double what is currently received
What is planned to be transferred to the State?
The proposal is a payment for defense or justice policies. The department added that other concepts that have yet to be defined, such as state agencies, certain infrastructures or services, could also be incorporated.
Who will benefit from the Territorial Rebalancing Fund and for what amount?
It is for communities with lower economic capacity. The proposal does not define the amount or which communities it is aimed at. In an interview months ago, Minister Mas placed solidarity at between 2 and 4% of the Catalan GDP. Today it is 8%
How will the personal income tax change?
The state section disappears. It would be the Generalitat that would set the types of taxation, the brackets, the vital minimums or the deductions.
Does the flight of corporate headquarters affect the collection of corporate tax?
An estimate will be carried out on the activity carried out in Catalonia. The Government will calculate through various mechanisms such as the number of workers in the community what part of the tax collection corresponds to Catalonia.
Does Social Security also transfer?
No. The system remains centralized. The proposal leaves aside Social Security, where Catalonia is a recipient of State resources. The Generalitat would contribute to the state fund with which the system’s deficit is financed.
When will it come into effect?
It can be gradual. Economy believes that a phased start-up model could be adopted
Is the model constitutional?
Councilor Mas believes that the model is compatible with that of other communities and recalls that there is a report from the Institute of Self-Government Studies that endorses the text.
Is it comparable to other models?
Yes. The proposal is similar to what exists in Canada or Germany, according to Economia.
