Discomfort in the Government and in the PSOE with the announcement by Ximo Puig to reduce the regional income tax bracket for those who earn less than 60,000 euros. In the midst of the fiscal battle with the PP and while the Ministry of Finance is finalizing a fiscal package to raise taxes on the highest incomes, one of the main barons of the PSOE got off the hook with an initiative that he had not agreed with Pedro Sánchez.
Neither Moncloa nor Ferraz yesterday wanted to support the president of the Valencian Generalitat. Neither in public, with several chain statements from fellow ranks, nor in private, where the tone was more forceful against a unilateral decision. There was an obvious lack of harmony. The head of the Treasury, María Jesús Montero, was the clearest in stating that the Government, with the set of measures that it is going to present in the coming days, seeks to "achieve fiscal justice and economic efficiency" to avoid cuts in social services. And "this second is very important," she said, referring to what happened in the United Kingdom after Liz Truss's tax announcements. "Investment prefers more resilient economies," she defended.
The also number two of the Socialists censured Puig's decision stating that he has taken the bait launched by the PP. "The policies of tax cuts cause a tax dumping that other autonomous communities follow to avoid a worse position," she said in an interview on Onda Madrid. Montero suggested that he had a private conversation with the Valencian Treasury Minister, although he preferred not to reveal the details. "It makes no sense for an autonomous region to lower taxes and then ask to improve its financing," he concluded.
The discomfort with the Valencian socialist baron was also evidenced by the minister spokesperson, Isabel Rodríguez, who asked after the Council of Ministers that the autonomous governments, of any color, raise a "responsible speech" in fiscal matters. The comment was addressed to the PP communities, but also to the barons who have left the door open to tax cuts, such as Javier Lambán in Aragón. It must be remembered that a few weeks ago the Basque Government, supported by the PSE of Idoia Mendia, already announced a deflation of personal income tax. Rodríguez warned that if income is reduced, “the debate on what to cut” opens. The Government, therefore, rules out deflating personal income tax in a general way to deal with inflation.
Patxi López, spokesperson for the PSOE in Congress, also distanced himself from Puig. The Basque leader said that he does not like "competitions to the bottom" in tax matters.
In Ferraz, where they were also unaware of Puig's announcement, they proclaimed that "we must be cautious in tax cuts, because they can undermine" the principle that "there is no social justice without fiscal justice." The Socialists preferred that the Valencian president had waited for the Government to set the line to follow.
The PP, for its part, applauded the decision that the Valencian executive had taken. “Welcome, Ximo Puig, to common sense and to helping families with the personal income tax review; We will not ask that the Valencians be penalized”, the party published on social networks. Its president, Alberto Núñez Feijóo, demanded "coherence" from the PSOE and that "they do not say one thing and 100 kilometers away the opposite." The main opposition party once again called on the Government to lower the VAT on basic, gluten-free and lactose-free foods.
