Spanish deal could mean first proper budget in four years

25 Nov 20

Spain’s minority coalition government may be able to pass the country’s first full-year budget since 2016, after a Catalan separatist party announced its support.

 

Inconclusive elections and minority governments with insufficient parliamentary support have left successive governments without the ability to pass budgets in recent years.

The Republican Left of Catalonia (ERC) said it had reached a preliminary agreement with the government on its budget proposals, making it likely they will be passed.

The ruling coalition, comprising the centre-left Socialist Party and its left-wing allies Podemos, has 150 seats in the 350-seat lower house, and ERC’s 12 votes along with Basque nationalist party PNV’s six would give the budget enough votes to pass.

“In this negotiation there have been two guides: extracting the maximum improvements for the people and the maximum number of tools for the Catalonian government,” said ERC’s parliamentary leader Gabriel Rufían.

He said he wanted to end “fiscal dumping” (attracting trade or investment through lower taxes) in Madrid, and form a committee for progressive tax reform.

Last month, the government announced it planned to raise taxes on large companies and high earners, alongside increasing public sector pay and spending an extra €3bn on health services.

Podemos leader Pablo Iglesias said the budget would allow Spain to “definitively leave behind the neoliberal stage of austerity and cuts”.

Spain last passed a budget in 2016, but more recently approved a spending plan for the second half of 2018.

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