Treasury Inspectors fear that Montero’s new financing will break the Tax Agency

The Association of State Treasury Inspectors (IHE) rejects the transfer of management powers of the State Tax Agency to the autonomous communities with a greater vocation for self-government which contemplates the new financing model presented this Friday by the Ministry of Finance.

The association warns that this would mean, in practice, a division of the state tax administration, an aspect that, in the opinion of the inspectors, the minister “avoids addressing because she is aware that it would lead to a significant increase in public spending and unprecedented inefficiency and ineffectiveness in tax management,” they point out.

Although this cost has not been calculated or mentioned by the Treasury, they consider that it would be “unaffordable” for Spanish citizens, it would prevent essential AEAT services from being guaranteed – such as personal income tax campaigns – and would seriously weaken the fight against tax fraud, widening its gap and ultimately forcing the State to assume additional spending that could only be met through tax increases.

The Executive has proposed establishing a network model of the tax system between the state Treasury and the regional tax agencies. The objective is for each autonomous administration to assume more powers in the management of transferred taxes, in coordination with the State Administration. Autonomous governments that wish to do so may benefit from a shared cash system where income from personal income tax will reach the central and regional administrations simultaneously. Each territory must communicate its intention to participate in this system in the joint commission with the State for a period of five years.

The system will allow the autonomies to have 20,795 million euros more in 2027, the year in which the Government intends for it to come into force if it manages to obtain sufficient support in the Congress of Deputies. The State will provide the autonomies with more resources in several ways. The most striking is that It raises the percentage of personal income tax transfer from the current 50% to 55% and also increases the VAT transfer from 50 to 56.5%.

Only with this change will the regions enter 16 billion euros more in 2027. The Executive also maintains the 58% Special Taxes on tobacco, alcohol, beer and hydrocarbons and adds to the transferred taxes the taxes on Property, on bank deposits, on gaming activities and on waste deposits in landfills.