Díaz Ayuso and the Lehendakari disagree again on which fiscal model to apply in times of crisis

New confrontation between the President of the Community of Madrid, Isabel Díaz Ayuso, and the lehendakari, Iñigo Urkullu, over which fiscal model to adopt in times of crisis. Though in several acts, the “popular” leader and the Lehendakari have once again emphasized their disparate views on taxation.

Inigo Urkullu He spoke this Friday in the monographic plenary session that will be followed in the Basque Parliament to analyze the consequences of the war in Ukraine. Faced with requests from the PP to cut taxes, the Lehendakari has called for “prudence”. According to him, “there is no social balance or quality public services without fair taxes.”

The President of Madrid, Isabel Diaz Ayuso, for its part, has opted for “huge tax cuts” and “tax relief” measures in Euskadi to be “much more prosperous”. The leader of the PP of Madrid traveled to Vitoria-Gasteiz today to participate in an event organized by the Basque PP in which she explained the tax model of the Community of Madrid.

Díaz Ayuso has pointed out that the PNV has “probably found a penchant for raising taxes because it’s a way for the administration to quickly swell the public treasury, but it’s not consistent with the long-term results it produces.” .”

According to him, “taxes must of course be paid”, because it is “a necessary bureaucracy to run good public services, but everything has to have a border”. “Ultimately, the regional governments ‘taifa kingdoms’who gain in strength and power, which go beyond their own skills and eventually that taste sometimes goes left and right,” he explained.

For this reason, he has called on the executives to “be strict and apply liberal policies” so that they do not become “a box that constantly collects, but does not return to public services later”. “Sometimes when he talks about the welfare state, it’s rather the welfare of the state that’s happening here. We like other people’s taxes and we’re not consistent with the damage this causes,” he assured.

“Tax Dumping”

Finally, he stressed that it is “false” for his government to practice fiscal “dumping” and denounced that the regional leaders making such accusations are acting in a “hypocritical” manner.

“Madrid operates under the fiscal framework that the current financing regime allows,” he said, recalling that his government has no powers over corporate tax – which taxes corporate profits. In this sense, he stated that the Community of Madrid would be “much more competitive” if it had the power to change this tax.

The President of Madrid recalled that the general corporate tax rate in the Basque Country is 24%, compared to 25% in the Community of Madrid.

Last November, the lehendakari, Inigo Urkulluexpressed concern about the “tax dumping” that he believed was being removed from the Community of Madrid through tax cuts and that “certain communities could be turned into tax havens”.

Exactly, in an interview with the ETB1 program “Egun On Euskadi”, the spokesman for the Basque government said, Bingen Zupiriawanted to clarify what the Lehendakari was referring to: “The Lehendakari made no statement about a possible tax battle between the Basque Country and Madrid. What Madrid does does not affect the Basque Country as much, but directly attacks those communities that do not have their own foral system In this sense, he recalled that Spain “has serious structural problems and Madrid is getting bigger every day and several communities are becoming vacant”.

The spokesman for the Basque government has assured that the Euskadi model means that “businesses will be helped to find the most suitable context so that they can generate wealth, which we need to guarantee quality public services through taxes”.