Madrid will go to the Constitutional Court if the Fiscal harmonization proposed by ERC is approved in the Budgets

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The Community of Madrid will go to the Constitutional Court if the “aggression” that would mean for Madrid the reinstatement of wealth tax and increase in inheritance tax, which would suppose “a fraud of law and institutional disloyalty”.

This is how the Madrid Minister of Finance, Javier Fernandez-Lasquetty, in an online appearance in which he stated that a fiscal “harmonization” in the General State Budgets (PGE) would mean an “attack” against the competence of the autonomies in tax matters.

Lasquetty has referred to the amendment on fiscal “harmonization” of the Republican Left of Catalonia (ERC) to the PGE and has affirmed that although it has been presented by this party it supposes “the real objective” together of socialists, Podemos and independentistas in Congress.

“We do not believe that it is an ERC initiative on its own,” said the counselor, who stressed that over the last year many socialist leaders have asked that Madrid be taxed “higher than it has” and as stated in Congress by the president of the government, Pedro Sanchez.

On the 17th, ERC registered more than 300 amendments to the PGE project, including five major vetoes to the Constitutional Court, the Ministry of the Interior and the Royal House, and also an increase in taxes on capital income, eliminate or lower the VAT on feminine hygiene products and diapers, or raise the tax on internet gambling.

Regarding the amendment on taxes, Lasquetty also said that in the Community of Madrid it was already “concerned” that the Minister of Finance, MarÃa Jesús Montero, when presenting the PGE project mentioned that the political groups would like to do something with the fiscal harmonization. That makes one think, the counselor said, that “they were in agreement from the beginning because they want to impose various taxes” that the Community has kept suppressed or modified for sixteen years.

The ERC amendment, Lasquetty explained, proposes that the Government impose on Madrilenians “a tribute that no longer exists” in the region, that of Heritage, by requiring “a minimum rate” throughout the country. The amendment, the counselor added, the State attributes powers that it does not have in management, liquidation, collection, inspection and review of the tax as it affects the state quota.

For Lasquetty, the amendment supposes “a direct attack to the Madrilenians, which does not seek to improve others, but to harm Madrilenians “with a tax, which does not exist – he said – in practically the entire European Union. Furthermore, according to the counselor, Madrilenians too they would have to pay higher inheritance and gift tax, which is “the dark object of desire of the socialists.”

In this case, autonomic powers in tax matters would be “dynamited”, said the counselor, recalling that this tax is fully transferred to the autonomous communities. For Javier Fernández-Lasquetty, if the ERC amendment is successful, it would mean “a genuine fraud of law and institutional disloyalty”, since both taxes are assigned under the autonomous financing regulations.

For the Community of Madrid, the amendment is “a threat” and, if approved, the regional government would go to court with legal arguments in defense of a reduced taxation model that the Madrilenians have supported for 16 years. The 2021 General Budgets project was approved on Thursday of last week, day 12, but before its final approval they will have to go through the Budget Committee and the Senate.

In a press release, the Community informs that in 2019 it registered a 7.7% increase in the collection of own management taxes, such as Inheritance and Donations Tax, Documented Legal Acts (AJD), Patrimonial Transmissions (ITP) or taxes related to Gambling. The collection of these taxes reached 2,164 million euros, compared to 2,010 million in 2018, despite the fact that last year new discounts on Inheritance and Donation taxes, AJD and ITP came into force in Madrid.

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