The executive director of Fedea, Ángel de la Fuente, and the president of the General Council of Economists, Valentín Pich, have opted this Thursday for the social agents and the Government to agree “urgently” on a broad income pact, which includes public employees and pensioners “at the appropriate level”.
For both, the income pact would avoid a spiral of prices and wages “that would tend to entrench inflation”, which would be a “ballast” difficult to overcome for Spain’s economic recovery.
For a few days, Fedea and the economists have agreed to demand more protection for citizens at risk of exclusion and for the productive sectors hardest hit by rising prices through direct aid in the form of unconditional transfers; and they advocate deflating the IRPF tax scale, adjusting upwards the income intervals to which each type is applied, in order to compensate for the loss of real purchasing power of income.
As for the new taxes on energy companies and financial entities announced this Tuesday by the Prime Minister, the General Council of Economists and Fedea have warned, pending further specification, that the introduction of ‘ad hoc’ taxes taxing certain sectors differently is not usually recommended, among other things, because it introduces an element of “legal uncertainty” that makes the country less attractive for investment and economic activity.
On the other hand, they consider that taxes on electricity companies should be designed “carefully”, since there are already other mechanisms to subtract possible extraordinary income from the sector and, as the European Commission warns, “an excess of zeal in this line will tend to discourage investment in new renewable capacity.
“In the case of financial entities, moreover, it is very difficult to argue that the beginning of the normalization of interest rates may be generating large atypical profits,” both entities underline.
On the contrary, both Fedea and the economists affirm that the sector has been operating for years in a complex scenario, characterized by “narrow margins” and faces “significant default risks” derived from the pandemic in the immediate future.
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