The European Economic Community Has Called On The Ombudsman To Appeal To The Constitution For A Higher Inheritance Tax
2021-02-10 | by CusiGO
Not only did employers not share in the rising estate tax included in the budget. It has also begun to take action to offset the rise. On Wednesday, Antonio Garamendi, chairman of the Federation of Spanish business organizations (ceoe), Josep s á nchez Libre, chairman of fonent del treball, and I nianigo fern á ndez de mesa, vice chairman of ceoe, met with the inspectors, At the meeting, Francisco fern á ndez marugan submitted a letter asking marugan to file an unconstitutional appeal against the tax increase, claiming that in the current crisis situation, it was “distorted and confiscated and therefore unconstitutional”.
The complaint is against the government’s decision to raise the estate tax of more than 10 million euros from 2.5% to 3.5%. Moreover, the 2021 budget makes the tribute permanent, and so far, the tribute has to be extended year after year.
As a matter of fact, the power to supervise this tax is vested in the regional government. Estate tax is a kind of national tax, its management power is transferred to the community, and the community has the right to apply for tax refund or deduction. Madrid is currently the only autonomous region with 100% tax exemption. In other words, in the capital region, taxpayers do not have to pay. Still, the outlook has changed: the government has made progress and will look at how to coordinate this tax in the fiscal reforms it is preparing.
The document submitted to the Ombudsman was signed by the chairman of the territorial organization of the autonomous region of the European Economic Community and supported by the federal Steering Committee. Make it a “lever” to create wealth, employment and public income.
“However, in the current environment of zero or negative interest rates, moderate real return on assets or heavy losses caused by the covid-19 crisis, the maximum marginal capital tax rate of 3.5% is far from this practice, but is distorted and confiscated, which is unconstitutional.”, Summarize the thesis. Employers argue that the constitutional court’s case law gives this treatment to those who tax “untrue, fictitious or nonexistent economic performance, or when their tax exhausts their taxable wealth.”.
The organization guarantees that, as a result of the increase in taxes, many taxpayers will be forced to liquidate their property and assets in order to obtain sufficient resources to pay taxes, as their current rate of return on assets is lower than the tax rate. The note added that irpf had already taxed equity gains, so “in this case, there is an unconstitutional assumption that is considered a penalty for savings, investment, productivity and economic growth.”.
Before this morning’s meeting, galamendi added that he was not opposed to having more people pay more, but he insisted that he did not understand the rise in inheritance tax, which would punish savings already collected by others. Sanchez ilibray emphasized this, adding that the “total elimination” of the tax would also resolve the debate on tax dumping, as some communities – as well as the Ministry of finance itself – accused Madrid of unfair competition for not taxing.
“In no case are we saying that we should not pay taxes,” galamendi added, stressing that “strangely, only Spain has such taxes.” In recent years, the international trend is to abolish the inheritance tax. At present, in Europe, only Switzerland, Norway – they are not partners of the European Union – and Spain have a comprehensive wealth tax, while in countries such as France or Italy, there are only taxes on certain assets. Nevertheless, the crisis has once again sparked a debate about the possibility of a new tax on huge wealth.
Ceoe has never concealed its opposition to the tax. In the past few years, the federal government has proposed to abolish the tax. After abolishing the tax in 2008, in order to deal with the financial crisis, it will temporarily re levy it in 2011. Since then, the community has taxed about $1 billion a year.