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| With more Taxes coming Spain continues to grow |
Almost no one enjoys the idea of having to pay higher taxes.
The reality is that higher taxes present a more favourable outcome than lower
taxes though.
Look at the USA and Greece. Many Americans are staunch
believers in the libertarian way, and almost any presidential candidate that
suggests raising taxes is given the boot quickly. The result is that parental
leave is almost non-existent, as is personal healthcare. Then there are all the
problems with public transport and the roads in bigger cities.
Then look at Greece. The country struggled for years because
of the culture of tax avoidance and the damage it caused to the economy. Some
people might have become rich by dodging their taxes, but society as a whole
suffered badly, and still continues to suffer.
Spain has taken a more socialist and liberal approach to
taxes. Income tax is often higher in Spain than it is in the UK. Companies are
also expected to pay high taxes on their profits. Even so, it’s usually clear
where all of the tax money is going. All the roads, resorts, beaches, and cities
are kept clean, modern, attractive, and safe. Spaniards are more than happy to
pay higher taxes if this is what they get as a result.
With this in mind, many Spaniards will no doubt welcome the
news that Spain is expected to collect around €200.9 billion in taxes this
year. There are two main reasons this is good news. The first is that it shows
the individuals and businesses of Spain are paying their fair share. The other
is that it shows the Spanish economy is managing to perform quite strongly following
the recovery from the credit crunch and double-dip recession.
The minister for the Treasury in Spain, Cristóbal Montoro,
said that the €200.9 billion figure will be an increase of 7.9% on the tax take
of 2016, as well as a record annual figure for the country.
The majority of this money will come from company profit
taxes and personal income tax. Commercial taxes will be responsible for around
€2.4 billion of the money; a 12% increase over last year.
Montoro also said that Spain has come clear of the economic
troubles of the past five years; which saw the loss of 3.5 million jobs and a
devastated GDP. Nowadays, both GDP and employment figures are up, and the
government feels comfortable increasing taxes on companies. Increasing taxes is
never very popular with small businesses, but economists consider it a
necessary move to keep GDP growing.
The next aim for the minister is encouraging businesses to
increase their wages to keep up with the wider improvement of the country.
Montoro said that the time when staff are paid as if they work in a country on
the brink of recession has passed, and that the economy is recovering.
It’s expected that the amount of income tax collected this
fiscal year will be 7.7% higher than that of 2016. This shows an increase in
jobs and wages, but it also shows there is still some room left for
improvement.
