The International Monetary Fund (IMF) asks the Government not to apply at this time the increase it envisages on the VAT of sugary drinks, and not to raise environmental taxes, among which are the tightening of the figure that taxes the diesel or the tax on non-reusable plastic containers. demands that the Executive do not apply these measures to protect low income.
This is stated in the review of the Spanish economy published this Friday by the body led by Kristalina Georgieva, a document in which he points out that “the measures that may have a disproportionate effect on the low-income population, such as raising VAT collection or increasing environmental taxes, must wait until the recovery is firm. “
That is, it considers that Actions can be positive, but not in a context as complex as the current one. But in addition, this warning contains a background that goes far beyond the two specific measures and that dismantles a fundamental part of the Executive’s speech: Your tax increase does affect the middle classes. In fact, it does so to the lowest incomes, to the so-called working class, which undoubtedly clashes with the “this government will not raise taxes on the middle class” that the Prime Minister, Pedro, always defends so much. Nchez, as the Minister of Finance, Maria Jesus Montero.
In addition, the agency has also been critical of the government’s decision to increase public pensions and salaries and, specifically, that the acquisition of these commitments implies a permanent increase in spending levels. “Commitments to permanently raise current spending ratios, for example through the wage bill and (public) pensions, should be avoided, given the high structural fiscal deficit and long-term spending pressures stemming from aging of the population, “explained Andrea Schaechter, head of the Fund’s mission in Spain, at the press conference he gave. And, in addition, he has remembered that “pension increases have not only maintained purchasing power but have gone further“
With regard to the labor market, the Fund considers that it is time to deepen the reforms that the labor market needs but, at the same time, underlines the usefulness and good results that have made it possible to achieve the modification carried out by the Executive of Mariano Rajoy. “The reform has helped to improve the situation in the labor market”, defended Schaechter, to which he added that any modification should be “studied carefully”, in clear allusion to the Government’s intention to eliminate the “most harmful aspects” of that legislation.
In this sense, the Fund proposes some actions such as the introduction of a single contract and the so-called Austrian backpack since, in his opinion, “it has the potential to significantly reduce the segmentation of the labor market in Spain, without increasing the cost of layoffs for companies or reducing employment protection for workers”.
Likewise, the IMF has added to the doubts that the Bank of Spain, the Independent Authority for Fiscal Responsibility (AIReF), the Bank of Spain and even the European Commission have previously expressed the figures that the Government reflected in its plan Budgetary. The Fund does not share the growth or deficit estimate, nor does it share the debt projection envisaged by the Executive. And it states that “the macroeconomic outlook that supports the government’s budget project is optimistic“Adding to that a weaker-than-estimated fourth-quarter GDP result, as containment measures threaten to provoke,”would hamper projected real GDP growth by 2021“.
According to the Fund’s data, the Gross Domestic Product (GDP) of Spain will plummet 12.8% this year, a figure that significantly worsens the 11.2% that appears in the official forecast. Furthermore, the rebound in 2021 will be 7.2%, which is even further from the 9.8% expected by the Government including the boost from European funds.
The deficit next year, for its part, will go to 14.1%, a forecast that once again is notably away from the 11.3% estimated by the Treasury. In 2021, yes, the IMF expects a figure even lower than that of the Government: 7.5% for the 7.7% included in the Budget Plan. With all this, the debt will skyrocket to 123% next year, which is five points more than the Government’s 118%. This is, a difference of more than 50,000 million euros.
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