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María Jesús Montero accuses Madrid of unleashing “capital flight” in other communities due to its “fiscal dumping”

The Minister of Finance hardens her speech and ensures that Andalusia and other communities are forced to choose a lower quality of public services, to avoid money transfers

The Minister of Finance, María Jesús Montero, has hardened his speech against what he calls the “fiscal dumping” of the Community of Madrid. In an intervention in the Congress of Deputies, Montero has accused the regional government of Isabel Diaz Ayuso to unleash “capital flight” in other autonomous communities and to the Popular Party to support this practice. “You are making it possible to defend Madrid’s fiscal position and force Andalusia, for example, to choose a lower quality of public services [al competir en bajada de impuestos] to avoid capital flight ”

The socialist minister has responded thus in an interpellation of the spokesman of the Popular Party, Mario Garcà © s, who has asked the Government to respect fiscal autonomy. “Fiscal autonomy is to modulate, it cannot be to eliminate,” Montero replied. The former Andalusian Minister of Finance has assured that the national PP previously defended what he calls fiscal “harmonization”, but “they have changed their position because they are afraid of the PP in Madrid.”

Montero has reaffirmed his intention to “fight that there are autonomous communities like Andalusia that, in order to collect like Madrid, is forced to increase the tax burden on citizens. It is not fair that they are forced to raise rates, because their per capita income level it is inferior to others that by making use of fiscal dumping are causing capital transfers “. According to Montero, this is the case of several governed by the PP: “I’m talking about Andalusia, Castilla y León, Murcia …”. Madrid does not apply the Wealth Tax and sets the lowest tax pressure in the country in personal income tax and in inheritance and gift tax.

Garcà © s, for his part, who was a councilor of the Treasury of Aragon, has denied the “dumping” of Madrid. “There is no ‘dumping’, each community has the capacity to modulate its taxes.” And he stressed that of the 84,000 million euros in general taxes collected in Madrid, the Community receives 19,000 million, 22%, and of the transferred 25% goes to other communities. “Garcés has urged Montero to reform the financing model and this has assured that his predecessor, Cristóbal Montoro, did not leave him in 2018 “any political document despite the fact that the system had expired”. This has been the case since then, but the minister has assured that she is going to promote a new system, because the current one “has been unfair with some territories.” But he has not specified any timetable.

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