The coalition believes that the municipalities need more income, since they have more and more powers. It also calls for reform of the tax system, to ensure that direct taxes exceed indirect ones.
EH Bildu has considered “essential” a new system of municipal financing in Euskadi that grants more income to city councils, institutions that have “more and more powers, are always the most affected institutions and are the closest to the citizen”.
In a statement, the sovereignist coalition has valued the increase in the income of the three Basque councils during 2021, 14.4% more than in the previous year, which “may be an indicator of recovery of the economy.”
However, he has warned that “a simple reading” should not be carried out, since increasing revenue by 14.4% more “does not mean that the revenue of all entities will increase by this percentage.”
“Our concern is that the increase in municipal income is lower than the general one”, they have affirmed, to add that the new Contributions Law “has not resolved that municipal financing is fair and sufficient”.
After pointing out that at the Meeting of the Basque Public Finance Council this Monday, the income that the Basque Government and the Provincial Councils will have will be specified, EH Bildu recalls that, on the contrary, municipal income will be determined in the Territorial Finance Councils that will meet in coming days.
“The Contribution Law sets the minimum percentage that the municipalities must receive, but each province applies a different percentage and differences are created between the municipalities depending on which province they are in,” they added.
As they have pointed out, with the approval of the new Contributions Law, municipal financing was “out of all debate”, in such a way that “there was no discussion about how this will affect municipal financing, since each province must define the financing of their municipalities”.
“Necessary define the percentage that the Provincial Council will contribute to the municipalities and agree on the distribution criteria among them. For this reason, we propose in Eudel the development of a new model of municipal financing”, they have maintained.
Tax system reform
Finally, they have warned that during 2021 more has been collected by indirect taxes than by direct taxes and “to have a fair tax system, direct taxes have to have more weight to properly tax the wealth that one has.”
“This collection puts on the table again the need to reform the tax system so that those who have the most pay in the proportion that corresponds to them and be able to move towards a fair, progressive tax system that guarantees sufficient income to adequately meet the needs social”, they have finished.
Source: Eitb
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