The budget mess in Spain just got a lot worse. Instead of corporate tax collection rising by the budgeted 20%, collection actually went negative. Personal income tax collection is also running behind target.
Via translation from El Blog Salmon Why Corporate Tax revenues Go So Wrong?
Negative Revenue During 2016
The latest data from the Treasury shows that the corporation tax collection is negative €539 million compared to €1.814 billion in revenue by 2015.
Never since the beginning of the corporate tax in 1995 has corporate tax collection been in negative territory.
There have been more refunds than payments as shown in the graph of tax revenue from 1995 to 2016.
The “State Budget 2016” forecast that revenue would increase by 20 percent.
The caretaker government expects corporate tax collection will improve as the year progresses, but not thought to reach budget targets.
Personal Income Tax Collection Will Also Fail
Also the collection of personal income tax has evolved worse than expected by the Government. There are great chances of not meeting the public deficit target this year as shown in the monthly tax collection report for May 2016.
Brussels is currently debating whether to punish Spain for failing to meet the deficit limit by 2015.
What Happened?
As an election ploy ahead of the December 2015 hung election, Rajoy rolled back tax corporate hikes. Corporations had effectively overpaid.
Blog Salmon says “If there is a third election in Spain, it is a certainty the deficit will not reach agreed upon targets with the European Commission.”
I will be more emphatic: Spain has a snowball’s chance in hell of hitting budget targets whether or not there is another election.
Mike “Mish” Shedlock
The bank’s printing press is slowly turning Europe into a banana republic. The printing press is also simultaneously confiscating purchasing power from Spain’s remaining budget. Myriad states and localities across the US are in a similar situation, and bankers confiscate the purchasing power from their revenue.
EU is already there!
Banana Republic with Monkeys for leaders.
Well, gee, if they just lowered the interest rates to negative 100%, the could permanently erase all their problems right now and well into the future. It’s just as easy as moving the decimal point over.
Negative interest rates and negative corporate taxes sound like a good pair. Now the EU has a chance to make matters worse.
But there is a positive side for those wanting to secede from Spain and form their own independent nation-states. The weakening Spanish central government will be too bankrupt to stop the secession movements.
Brexit plunges UK economy to worst level since 2009, data suggests
http://www.bbc.co.uk/news/business-36864273
Did everybody get that? It’s ALL Brexit’s fault! Nothing at all to do with successive generations of failed economic policies, crippling debt, ‘me too’ money printing by the idiots at the Bank of England, lack of competitiveness, a shrunken manufacturing base, the current global downturn, and endless can kicking until there is no more road left to kick the can down. No – get this, despite export orders actually being UP, the economy is down overall and it’s ALL Brexit’s fault!!
Silly me … It’s all my fault and if only I’d known this would happen that I would have voted to remain /sarc. (One time people used to respect the BBC. Now they just treat us like idiots and I just wanna spit!)
Yep, the beeb used to be just factual, seems now they have to introduce ‘something else’ to ‘balance out’ any accuracy. Big shame.
I think it’s much worse than that. The Beeb still maintains its ‘apparent’ high ground of objectivity, whilst (imho) following a definite political agenda of its own, or at least that of some influential body. And so it gets away with passing on to the public significant misinformation that all too easily becomes accepted as fact. It’s because it’s publicly funded. You could almost come to expect second rate stuff from a commercial station since they have to dance to the tune of their sponsors; but with the Beeb I would have expected better. It seems to have become hijacked.
Take my neighbour for example – a well educated bloke, degree from Cambridge professional type who you would like to think has an enquiring mind; but he unquestioningly parrots back to me the propaganda that the Beeb keeps relentlessly ramming down his throat without a second thought. I have suggested to him that perhaps someone somewhere has an axe to grind, but he regards this line of thinking almost as treason.
For myself, I prefer to come to sites such as this for opinion; the Beeb has almost become a secondary source. Pick out what facts there are, but leave plenty of space for interpretation.
As you say… I only read bbc to pick up facts nowadays, so I guess I haven’t been watching how they portray events much as I have switched off to that. Have learnt to skip opinion completely as I read any article anywhere. That is why Mish is good, he is more interested in questioning what is going on than forcing an agenda… kind of an honour nowadays to be presented with information by someone who actually brings the encouragement that you are also able to think it out for yourself.
Amazed how the story of possible election fraud was ‘vanished’ from the msm in Spain. There are a few dedicated behind the scenes to get answers and part of the population concerned, but apart that even final official result release, and its procedure (which was one window to being able to demand detail, but would have needed a political party to oblige that ) seems to have been completely blanked. Never has the lack of accountability been made so obvious in modern Spain, it is as if EU is supposed to have the answer, and yet have its involvement rejected as suits.
Spain, Brexit, Greece, and Italy show the utter lack of effectiveness of attempting to use monetarist policies as a response to an economic depression. Monetary policy is only capable of propping up the banks. Attempts at austerity only force spending and deficits up.
This was all well understood after the Great Depression. We just have to be taught the hard way again. How I know religion is false: man is too stupid to be created in the image of God.
..or rather, the people who claim to follow God end up ignoring Him and doing things their own way…. and when their way inevitably fails, others then blame God – which makes no sense.
“If there is a third election in Spain, it is a certainty the deficit will not reach agreed upon targets with the European Commission.”
No Way No How does Germany stay in the EU (in the long run) without a fiscal union.
Goat cheese.
Goat cheese.
Its all about the goat cheese people.
We owe Spanish culture for the siesta and the sombrero. Tax both and balance the Spanish budget.