In the case of Alicante, the bipartisan estimates that the revenue section will be cut by about 15 million euros, which is why it has now been forced to paralyze the preparation of the accounts to draw up a “plan B”, pending possible movements from the central government, as they are already requesting municipalities. «The Budget project was practically closed to process its approval and it has had to be stopped. The government team has launched a ‘plan B’ with 15 million less income, “they explained this Wednesday from the Mayor’s Office, where they have already marked in red the items susceptible to cuts if a Budget with 15 million must finally be approved less income: «With the investment chapter committed by the multi-year, there is no choice but to adjust in current spending and subsidies; that is, in projects in areas that are not investments. In no case will the Alicante City Council apply reductions in public services (cleaning, waste collection, …), or in the personnel section ”. And is that the local government committed 18 million of the 2022 accounts by promoting multi-year investments to finance this 2021 with the remaining treasury. Among these projects, the pedestrianization of the Traditional Center stands out.
According to the same sources, the municipal Budget Office “has been working since Wednesday to develop this alternative.” The Barcala executive has focused on the central government, as the president of the Spanish Federation of Municipalities and Provinces has also hinted. From the Mayor’s Office of Alicante they point out that «only if the Government of Spain reacts very quickly delays and cuts suffered by all citizens will be avoided». From the municipal government they insist that «It is not a specific problem of the Alicante City Council, but of each and every one of the more than 8,100 consistories of the country “, for which they demand the intervention of the Sánchez Executive:” It is a problem that only the Government of Spain can solve. Their performance depends on whether or not the municipalities see our resources substantially reduced and that we can have budgets on time. The Ministry of Finance has already advanced this Tuesday, after knowing the ruling of the Constitutional Court, which will review the capital gains tax so that the municipalities continue to enter it.
THE KEY: CHANGE OF DATES
Redoing the document will cause a delay in the approval of the accounts
Redoing the accounts will force the bipartisan to delay the approval of the accounts, which had been planned before the end of the year.
The City Council of Alicante had planned to enter this year 15.3 million for this tax, 5% of the municipal budget, so the forecast for 2022 would have been similar. The capital gain is the third tax that has allowed the Alicante capital to collect the most money so far, behind the Real Estate Tax (IBI), which contributes about 85 million to the coffers, and the Vehicle Tax with about 15.9 million. The mayor of Alicante, Luis Barcala (PP), considered this Tuesday that “the sentence endangers the budgets of all municipalities in Spain that necessarily have the income derived from capital gains.” “This procedure, and its resolution by the Constitutional Court, was known to the Sánchez government, which has been promising the corresponding legal reform for more than two years,” added Barcala. The president of the FEMP and mayor of Vigo, the socialist Abel Caballero, pointed out that, if the first interpretation of the judgment on capital gains is confirmed, it would be necessary to “propose a new rule that allows the tax to be restored with fair collection.”
The high court announced the declaration of unconstitutional and, therefore, invalid sections 1, 2 and 4 of article 107 of the law regulating local finances, because “it establishes an objective method of determining the taxable base of the Tax on Increase of the Value of Urban Land, which determines that there has always been an increase in the value of the land during the period of the imposition, “regardless of whether it has actually occurred and its actual amount.
To prevent the chaos that a sentence of such significance at the national level can entail, the ruling, the full text of which will be known in its entirety in the coming days, declares the “intangibility” of the firm situations existing before the date of approval of the resolution, which means that they cannot be touched.
Eddie is an Australian news reporter with over 9 years in the industry and has published on Forbes and tech crunch.