Tax collection is evolving at an extraordinary pace. Tax revenues as a whole but, especially, those related to personal income tax, figure that in the first four months already accumulates more than 40,000 million and advances a rate of 11%. It is the direct consequence of the decision of the Ministry of Finance not to adapt the tax to inflation, and to demand more than ever from taxpayers.
The collection data for April of the Tax Agency show this, with a specific income figure of 41,611 million for the 37,200 million that accumulated in the same period last year. Economic activity itself explains part of this increase, no doubt, but the big difference is that wages, public and private, have rebounded to cope with inflation but the Treasury has not deflated the tax. This causes a double loss for the worker. On the one hand, because their wage increases have been, in the vast majority of cases, far from the level of inflation and therefore have lost purchasing power. And on the other, because, in addition, they have to pay more taxes for these wage increases.
Therefore, deflatation is a widely recommended practice in the economic literature and by economic experts. But the department headed by María Jesús Montero has always refused to do so. They affirm that it would be a measure that would also help high incomes, since even if only some sections are adapted, all incomes would benefit. They add that the funds that are being collected by the IRPF are necessary to finance tax cuts on food, electricity or gas, and also point out that deflatation could accelerate inflation because, especially the lowest incomes, they would spend those savings.
Where this measure has been applied is in the regions that were already governed by the PP before the recent regional elections. The Community of Madrid, Andalusia, Galicia and the Region of Murcia adapted part or all of the autonomous section to inflation, and in Castilla y León a reduction was directly applied. Now, the foreseeable is that the regions in which the Popular Party has wrested power from the PSOE follow the same path. And if Alberto Núñez Feijóo arrives in Moncloa after the early elections to be held on July 23, the reduction of personal income tax will be in the country as a whole. Or, at least, that is what he promised yesterday in Barcelona during his speech at the Cercle d'Economia.
Returning to the collection figures, the rebound in personal income tax is also vital for this good performance of total income: an increase of 5% to exceed 90,000 million. As in the case of personal income tax, it is a historical maximum. Data never before reached in such a short time.
Something very similar happens with VAT, although in this case the progress is more contained. Inflation has moderated, and that is evident in the figures. 'There is a lower intensity of price increases, accentuated by the fact that some of the products with the highest price increases have seen their VAT rates reduced, so that the variation in prices that would be appropriate to see their impact on revenue is even smaller than what is clear from the indicators normally used'. explains the Tax Agency. But even so, the 35,300 million it contributes is already the highest figure recorded in a month of April.
And to all this we would have to add the figures on banking and energy, which the Government does not call taxes to try to avoid possible complaints from the affected companies. According to the budget execution data that were also known yesterday, these two "temporary levies" add up to another 1,510 million euros.
Precisely in these data, the Treasury reported that the deficit of all Public Administrations at the end of the first quarter of the year was 0.2% of Gross Domestic Product (GDP). The figure represents an appreciable reduction compared to 0.4% in the same period of 2022, and in this reduction the constant that is repeated in this text is also key: the notable increase in tax collection.
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