High earners in Andalucía to see tax increase

Tax chief Carmen Martínez Aguayo and spokesman Miguel Ángel Vázquez
Tax chief Carmen Martínez Aguayo and spokesman Miguel Ángel Vázquez

This week the Junta de Andalucía has announced it’s plans to enable the region to meet it’s deficit target of 1.5% of the regions GDP and it seems high earners are to be hit with a tax increase.

The plans, which amount to a total of around 2.5 billion euros  will mean an average 5% pay cut for public employees, including the regional president and ministers. The hope is that this measure alone will save 780 million euros in personnel costs.

Other measures include a hold on all non-emergency public works which will save an estimated 570 million euros from the 2012 budget, which has been reduced to 29.5 billion euros.

For those people earning between 60,000 and 120,000 euros a tax increase will be implemented rising to 23.5%. Those earning in excess of 120,000 will see their tax rise to 25.5%. Currently those earning between 60,000 and 80,000 are taxed at a rate of 21.5%, while those earning between 80,000 and 120,000 pay 22.5% tax. The rate for earning over 120,000 is currently 24.5%.

I think this is the first measure taken that actually makes sense. To recognise that the higher earners can afford to pay a little more without damaging their bottom line is great. Low income families are the ones that are really struggling and to leave them out of the tax increases is commendable. It’s common sense really so it’s a shame it’s taken so long for government to realise.

Well done Junta de Andalucía – if you can only get the rest of Europe to follow this I’m sure things would get better quicker.

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3 thoughts on “High earners in Andalucía to see tax increase

  1. Henry III

    A quick way to alienate those that bring the largest revenues to the region, watch them relocate, if not personally at least on a company/banking level. The rich are rich because they are always looking at how to reduce their overheads. Perhaps a better resolution would be to get the low income families earning better money, maybe make themselves self-sufficient turning them into an asset for the region as opposed to a liabilty, punishing success is a very narrow minded, socialist, left wing misconception.

    Stick that in your pipe and smoke it Real-estate insider.

    1. Well, the obvious flaw in your idea is that most of the rich already bank off-shore anyway to avoid paying the same tax that everyone else has to pay – it’s criminal and should be stopped.

      So punishing them is wrong, I agree, but ensuring they pay their dues is absolutely necessary.

      The law should be that you pay full tax in the country where you work. If you’re in England full-time, using British public services, then it is disgraceful to “bank” in Luxembourg, Gibraltar or Switzerland, paying that countries lower tax rate.

      In England, tax in England – that’s the only way it can work and be fair.

      If businesses want to leave the UK because of tax then fine, let them go! Where are they going to go? America? Not likely – they are in even more debt than the UK! So where? They always say that and it’s just a bluff – I remember the bankers when the crisis hit – “We can’t punish them because they’ll go elsewhere and we need the best here” – the best? The same “best” that caused a global economic breakdown? The same best that were bailed out by British taxpayers money and then repossessed those same taxpayers properties because they couldn’t keep up due to the crisis that said same bankers caused! Is that just? Is that fair?

      They are not the best at anything and should be allowed to leave, if not forced!

      The rich contribute to the crisis by avoiding tax in the billions, and you know it living in England where your leaders in their wisdom have cut tax for the rich and raised it for the poor.

      Is that a better way of fixing things? I think not!

      So stick that in your pipe and get a seriously bad chest cough that even Night Nurse can’t fix 😉

      Some men you just can’t reach…

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