Taxes can cause a political fire among the Government’s allies. That’s what you’ve been through the intention to make extraordinary taxes permanent to energy and banking. Some levies approved in 2022 to cover aid to households and companies due to the cost of living crisis. And they targeted the sectors, banking and energy, that were benefiting the most from the escalation of inflation and rate hikes. Sumar’s economic spokesman in Congress, Carlos Martín, proposed this Tuesday that the State take a controlling stake in Repsol after the company chose Portugal to invest 15 million euros in the face of regulatory and fiscal instability in Spain. A decision that Carlos Martín has called “fiscal blackmail” against Spain. “They threaten to take strategic investments to Portugal if taxes are not lowered on the historical profits they are registering,” Martín denounced in a message published on the social network X, formerly Twitter. In the same message, Martín recalled that the energy company is a company that was born “from the privatization of public companies grouped in the National Hydrocarbons Institute, such as the Campsa distributor, the Enpretrol refinery or Butano.”
Martín’s proposal comes after the publication by the CEO of Repsol, Josu Jon Imaz, of an opinion forum in which harshly criticizes the tax. And point out that its maintenance is “the toll to pay for Sumar to continue supporting a Government.”
The response from Sumar’s parliamentary spokesperson was immediate: “Repsol is therefore based on a collective country effort,” he added. At this point, Carlos Martín has criticized that in the 1980s “it was decided to squander public corporate assets by underselling them,” which in his opinion “has led to a less autonomous economy and dependent on the greed of a handful of executives.” and shareholders.”
More taxes
The spokesperson for the plurinational group proposes several ways to address which he calls “blackmail”. The first of them is to increase taxes on those energy companies that do not make sufficient strategic investments for the green transition in Spain and using these resources to carry them out. The other proposal involves public participation in control in a similar way to what was done with Telefónica and, finally, promoting at the European level a regulation that prevents ‘dumping’ between countries and corporate “tax blackmail.”
CC OO of Industry and the union section of the organization at Repsol also showed this Tuesday their “concern” and “outrage” at Imaz’s statements of conditioning certain investments in Spain to the existence of the extraordinary tax on large energy companies, for which He demanded an “urgent” meeting from the company. In this sense, the union criticized that it did not take into account the workers, as well as the “effort” of the territories. For this reason, it will “immediately” request meetings with the company and with the ministries involved so that, through dialogue, “a solution can be built in which the industry, investments, territories and employment are not endangered.”
Attacks against the extraordinary tax
The CEO of Repsol, Josu Jon Imaz, has attacked the Government’s decision to make the tax on the energy sector and banking permanent and has warned that “fiscal populism” will compromise the future of the industry in Spain. In a forum in several newspapers, Imaz warns that by prolonging this measure, initially planned for the years 2023 and 2024 – in the case of energy companies, with the application of a 1.2% tax on sales, to be settled with charge to the years 2022 and 2023—, investment in the Spanish energy sector “will slow down to a minimum.” And he explains: “Billions of euros will be diverted to other countries. It is possible that, given the difficulty of decarbonizing, the Spanish refining sector will have difficulty maintaining itself before the end of this decade. We will create many jobs in low added value services, possibly poorly paid. Our social coverage will have difficulty sustaining itself in the future, because the type of employment that is created and the lack of resources generated by the one that is lost leads us to a competitiveness model that is far from the leaders we should emulate,” he emphasizes.
Toll for Sumar to remain in the Government
The Basque businessman recognizes that “it hurts even more that his future is extinguished amid demagogic speeches against big companies and the rich. Or that it is simply because of the toll to pay for Sumar to continue supporting a Government.”
Imaz also defends that “debates about taxes are legitimate in a democratic society” and that he has always defended “a redistributive vision of fiscal policy.” “Perhaps that is why I am particularly repelled by demagoguery around tax issues,” he adds. For this reason, he regrets that the parties that make up the Government have presented a proposal to make the tax permanent, “beyond the one that, like any other company, pays for its profits as corporate tax”, without there being any debate or ” a rigorous analysis of the consequences.”
“There is not even frank dialogue with industrial companies. Simply populism and demagoguery shouting ‘let companies pay to favor those who have a hard time’. Those politicians who even in private recognize that this double taxation is absurd do not dare to raise their voices for fear of being considered defenders of the ‘rich and the companies’, exposing themselves to the masses being launched against them for being “antisocial.” ”, he states.
Pending court decision
Furthermore, Imaz, considering the “legal arguments” that paying twice for a similar concept such as the benefit “will one day end up in court, which is likely to happen,” believes that “the current rulers will possibly be far from their duties.” when this happens, so “they will not have to pay the consequences of their populist and illegal policies.”
Likewise, Repsol’s chief executive highlights that Spain “is a leading country in refineries in Europe”, which, in addition to the security of supply that this entails, means that “more than 200,000 jobs are generated, including direct and indirect and induced, in addition to guaranteeing the industrial employment of the two main chemical centers of the country (Tarragona and Huelva).”
Therefore, he estimates that the objective is to “continue competing” with products that come from the Middle East, India or the United States, while making progress in decarbonization; “that is, increasingly manufacturing a more renewable fuel to mitigate the impact of CO2.”
Likewise, he believes that “fiscal populism will penalize this activity with a discriminatory tax that makes it impossible for this investment to be carried out,” and will make it “impossible” to compete with energy investment in the United States. In this way, recognizing that his opinion may be “irrelevant”, he invites the members of the Government to “read the conclusions of the European Commission on this tax or the Draghi Report.”
The Repsol executive, who was a leader of the PNV, has the support of Basque nationalists. The president of the PNV, Andoni Ortuzar, called this Tuesday to be “careful” with taxes on energy companies and banks because, in his opinion, “it is not good to kill the goose that lays the golden eggs.” referring to the statements of Vice President Yolanda Díaz in which she has insisted on the maintenance of these taxes.
In an interview with TVE, he called for being “careful” and “reasonable” about the imposition of the tax on energy companies and banks and warned that it could do “a disservice to the continuity of the industrial sectors” in Euskadi. , because some companies have already said that they are going to resent their investment plans.
The Jeltzale leader has pointed out that “now they are not taxes, now they are quite irregular levies.” “If we were to evaluate this measure, it would be that it be imposed and, if it is imposed, it must be agreed upon with the Basque Country, which would then have the capacity to organize and articulate that tax in accordance with our fiscal reality and our industrial reality”, he indicated. In any case, he has warned that “it is not good to kill the goose that lays the golden eggs.” “You have to be careful with these things, do things that are reasonable and tested because, from an ideological point of view and from a public communication point of view, ‘the rich pay more’ is very good,” the benefits that come from heaven’, etc,” he said.
The Basque Country is very industrial
Ortuzar recalled that Euskadi has “a very industrial reality” and they know that “if money is taken from one place, other items will suffer,” and he has warned that some companies are already warning that their investment plans “are going to suffer.” ”. “It would be a disservice to the continuity of the industrial sectors, which are very powerful industrial sectors, for example in Euskadi, if this would affect the investment plan of the energy companies, which are companies that invest a lot and also invest in capital goods that They are made precisely by the Basque auxiliary industry,” he pointed out. In his opinion, “all these factors must be taken into account, we must have fair, progressive taxation, effectively, whoever has more benefits, should pay more. I believe that we must implement a strict fiscal policy, but be careful not to kill the goose that lays the golden eggs,” he reiterated.
Realism exercise
On the other hand, he has asked the parties that support the Government to carry out “an exercise in realism” and look for “a minimum denominator” to achieve General State Budgets (PGE) “adequate to the needs of the moment.” Likewise, he explained that the PNV is beginning to have the first contacts with the Government, and they do not yet know “too many details of what the main items are, nor the investments, nor those multi-year agreements” committed to from previous years and the agreements of legislature. “It’s early to talk.
The Government already knows what the PNV’s roadmap is, I believe that we are the most predictable party in the Congress of Deputies. We like that institutions have budgets, and therefore we would like there to be budgets this year and also for the agreements with us to be fulfilled,” he stated. As he has indicated, “the negotiation will be guided by these two parameters” by the Jeltzales. Their goal is for “things to be done well,” and they will not impose “impossible conditions.” “We are not going to exaggerate our demands at the outset, because with the disparity and heterogeneity that the Congress of Deputies has, it is very complex and the only thing it brings is the danger of all this running aground,” he stressed.
In his opinion, “it is time to do an exercise in realism, to look for a lowest common denominator” between the two parties in the Government and the formations that support it from outside, to “obtain Budgets appropriate to the needs of the moment.” He also believes that Podemos falls into “a bit of exaggeration and overacting” with its consultation with its subscribers. In his opinion, Budgets “always have a ritual of negotiation and the initial phases of the ritual are more about noise and shouting than reasonableness.”
