PRESIDENT Pedro Sánchez has shelved any potential tax rises until after Spain has recovered financially from the Covid-19 pandemic and economic growth has returned to levels prior to the health crisis.
“That's when we'll have the guarantees and the context we need to approach the necessary structural reforms,” the socialist leader said.
Spain is not alone in seeing its GDP plummet this year – by a whopping 18.5% so far – and it is logical this would be the case, given that the country, like most of the world, was in full lockdown from March to the end of May and all bar essential businesses forced to close their doors unless their staff could work from home.
Now, though, it appears unlikely a blanket national shutdown would happen again: Further outbreaks of Covid-19 are localised, testing and contact-tracing is taking place much more quickly, and cases are swiftly contained, meaning any lockdown would only be applied in specific towns on a temporary basis.
As a result of the State of Alarm being declared over at the end of June, employment went up in July – with 161,217 workers now back 'in the system' – although this is still a long way from mopping up the 750,000 jobs which disappeared temporarily or permanently over lockdown.
Temporary lay-offs, or 'furloughs', are already officially extended until the end of September, but the government intends to stretch them out even further in light of a rise in cases nationwide.
Pedro Sánchez has strongly hinted, though, that tax rises would not apply across the board and would be unlikely to hit the average worker or those on low incomes.
He says tax changes need to be applied 'with justice' given that 'a huge amount of people' believe they actually pay more in taxes than others who are much wealthier.
“We need a more sustainable and stable taxation structure over a longer term,” he argues.
But not just now – although the country is facing 'enormous' deficits and public debts, the country's first priority is to 'maintain companies and workers' during the pandemic.
Read more at thinkSPAIN.com