Treasury rules out that the collection could collapse as it did during the financial crisis

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Secretary of State is confident that tax revenue growth will be “held and consolidated”

The Secretary of State for Finance, Jesús Gascón, is convinced that the income growth recorded in recent years “will be maintained and consolidated” and he does not believe in any case that there will be a “collapse” of the collections as happened in the financial crisis . “There will be at most a small oscillation, but there will be no crash,” he said this Thursday at the XXXIIth Annual Congress of the Association of State Treasury Inspectors (IHE), being held in Granada.

According to data through August, tax collection grows above 18%. The Ministry of Finance communicated to Brussels after the presentation of the Budget Project for 2023 which calculates a ‘pillow’ of between 15,000 and 20,400 million in revenue between this and the following year. Part of that confidence in sustaining sales despite Spain heading into a technical recession in the last quarter of 2022 and the first quarter of 2023 is that nearly a third of sales growth is not linked to economic growth. or inflation, but that it would arise from the rise of the sunken economy and the fight against tax fraud. “We don’t have any data, but we think this phenomenon is happening,” Gascón stressed.

“The question is what part of that growth is structural or cyclical, whether we’re going to have it forever or what’s going to happen,” Gascón said, although he clarified that he doesn’t believe “the same thing is happening as in the financial crisis,” when bursting the ‘real estate bubble’ caused a collapse of 41,000 million in tax collection in two years. “What happened then will not happen to us,” said the State Secretary and chairman of the Tax and Customs Administration.

A quarter of the increase in collection between January and August is attributable to inflation. Recalling the measures the government has promoted to deal with the escalation in prices and the energy crisis caused by the war in Ukraine, Gascón noted that the government is planning a new royal decree on crisis-fighting measures in a few weeks. to approve that some of the taxes already in force, including some taxes, will be included.

In addition, he explained that the Executive plans to approve the new tax on large fortunes as an amendment to the bill pending Congress to tax extraordinary income to large energy companies and financial entities. The government expects its approval and entry into force in 2022 and will continue until 2023, with collections that will affect the years 2023 and 2024. These changes also include the limitation of corporate tax deductions for large multinationals, which can be up to 50% of the ability to offset losses of subsidiaries in consolidated groups.

Source: La Verdad

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