The Generalitat of Catalonia finalises the approval of a tax reform that will lead to increases in personal income tax or inheritance tax, plus the creation of new green taxes. The objective is to increase revenues with regards to previous budgets in 2017 of 2,200 million euros that come from the "increase in revenue, because the economy has grown," according to Pere Aragonès, Minister of Economy.
According to Aragonès, Catalonia will go from a GDP of 215,000 million euros in 2017 to one that will exceed 230,000 million in length.
As for Personal Income Tax, the reform will affect several sections, not just high incomes. They want to increase progressivity. In an interview with TV3 collected by Europa Press when asked if the changes in that tax will be made both above and below, he has insisted that it will be done “everywhere” because they seek to provide it with more progressivity and has specified that they also intend to introduce improvements for lower incomes.
Catalonia has the highest type of personal income tax in the regional section that it is responsible for managing. Thus, the marginal rate for income above 175,000 euros is 25.5% in the regional section, which means that the euros entered from this amount are taxed at 48%, compared to the maximum rate of 45 % that Madrid currently applies, and that, with the new PP Government, Citizens and Vox are studying reducing it further.
As for the Inheritance tax, the Minister of Economy assures that they will tax large inheritances. But he has not determined how. Although this tax does not reach the level of Madrid where it is 99% subsidised in case of inheritance to children, in this region there are tax benefits in inheritance between siblings.
Thus, the inheritance of a brother with a house of 200,000 euros and 600,000 euros in cash requires, in Catalonia, the payment of 239,945 euros, 30% of the total, compared to 49% that would be paid in Murcia (391,672 euros), for example, according to the calculations of the Fiscal Advisors Economists Registry (REAF).
Finally, they are looking at creating new green taxes to fight against climate change and invest in improving public transport, for example.