The Government will celebrate tomorrow, Thursday, October 7, a Minister council extraordinary to approve the bill of the State’s general budgets by 2022, after the agreement reached this week between the members of the Executive, the second public accounts of the coalition government PSOE-Unidas Podemos.
After months of intense negotiations between PSOE and United We Can, the government partners yesterday closed the agreement to give a ‘green light’ to the public accounts of 2022 after unlocking the pact to impose a minimum effective corporate tax rate of 15% for large companies and to approve the first State Housing Law.
Last July, the Council of Ministers approved the non-financial spending limit, known as the ‘spending ceiling’, which remains at 196,142 million euros, which is 45 million more than the figure registered a year earlier, a new record, including extraordinary transfers to the autonomous communities and Social Security and part of the European funds.
5% deficit and 4.6% rise in tax revenue
With this spending ceiling, the public deficit will be reduced to 5% of GDP, compared to the 8.4% forecast for this year, thanks to a 4.6% rise in tax revenues compared to this year.
Excluding European funds, the ‘spending ceiling’ would stand at 169,787 million euros, 0.7% more, so the amount from the ‘Next Generation EU’ amounts to about 26,355 million euros, which will be used to “strengthen the economy and make it more solid and sustainable.”
To do this, one of the measures that the Executive intends to include is the setting of a minimum rate of 15% in Corporation Tax for large companies, in line with international consensus and the recommendations of the OECD and the European Commission. All this without prejudice to the tax reform that is being analyzed by a committee of experts, which must present its conclusions in February 2022 so that they will later be studied by the Government.
Next year, the Government is also considering raising the salary of public employees by 2%, while in the case of pensions they will already be increased in accordance with the average inflation of the previous twelve months until November – average between December 2020 and November 2021 – while the minimums will rise more than the rest.
What’s more, Budgets will also include a Youth voucher for the rental of homes of 250 euros per month for those between 18 and 35 years old. This aid will last a maximum of two years, and those who receive income from work and annual income of less than 23,725 euros can benefit from it.
The public accounts will also incorporate Another youth voucher endowed with 400 euros so that young Spaniards who turn 18 in 2022 can use it for the purchase of books or the consumption of any type of artistic activity or scenic, such as theater, film or dance.
The budget agreement between the Government partners has excluded the extension of maternity and paternity leave to six months, one of the main claims for ‘purple’ training.
“In a negotiation everyone gives in a bit and this is an issue that is difficult for us to convince the PSOE,” acknowledged the Secretary General of United We Can and Minister of Social Rights and Agenda 2030, Ione Belarra, in an interview in the RNE collected by Europa Press.
They will arrive at Congress next week
The Minister of Finance and Public Function, Maria Jesus Montero, will be in charge of detailing the public accounts at the end of the extraordinary Council of Ministers, to take them next week before the Congress of Deputies. The idea of the Executive is that before December 31 the Budget Law is approved and, therefore, on January 1 it enters into force.
For this, the Minister of the Presidency, Relations with the Courts and Democratic Memory, Félix Bolaños, has assured that all political groups will be heard to try to integrate as many parliamentary groups as possible. “The idea is that we approve these Budgets for the essential fair recovery that we are addressing from the Government after the pandemic,” he remarked after announcing the agreement.
Eddie is an Australian news reporter with over 9 years in the industry and has published on Forbes and tech crunch.