Navarra and the State reach an agreement to update the Economic Agreement



Economic Agreement


Among other novelties, the Navarre Treasury will assume the collection of three new taxes. Gero Bai and EH Bildu have already announced that they will abstain in the parliamentary vote on the reform of the Economic Agreement Law.

The Negotiating Commission made up of representatives of the state and Navarrese governments has reached an agreement on Monday for the update of the Economic Agreement Law between both administrations.

The update, which will have to be approved by the Parliament of Navarra and by the Parliament, entails the modification of 28 articles, 6 additional provisions and 7 transitory provisions of the Law on tax and financial issues that govern relations between Navarra and the State.

This is the sixth amendment to the 1990 Agreement. From then until today there had only been updates in the years 1993, 1998, 2003, 2007 and 2015, the Minister of Economy and Finance reported at a press conference, Elma Saiz, who has specified that the calculation of Navarra’s contribution to the State still has no date, but it will be done “sooner rather than later.”

For Saiz, this agreement “is a sample of the fluid relations between the Government of Navarra and the Government of Spain and represents the achievement of an objective long sought in Navarra.” The agreement, according to Saiz, “reinforces Navarra’s tax and financial regime and reflects in its content the maturity and stability that the Economic Agreement has reached.”

The update contains news in both the tax and financial fields. In the first of them, the Navarrese Treasury will assume the collection of three new taxes: the Tax on Financial Transactions, the Tax on Certain Digital Services and the VAT on electronic commerce (VAT OSS).

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In addition, various modifications are included that imply improvements in the management and inspection of the Provincial Treasury and in the coordination between tax administrations.

Geroa Bai and EH Bildu will abstain

For their part, Geroa Bai and EH Bildu have already announced that they will abstain in the parliamentary vote on the update of the Economic Agreement Law.

At a press conference after the Table and Board of Spokespersons, the spokesperson for Geroa Bai, Uxue Barkos, has indicated that the coalition regrets that important issues such as the rate of imputation of the State burdens that Navarra must assume, now at 1.6%, have not been previously dealt with.

For this reason, he said, in the absence of the “minimum necessary contact” to “be able to share a decision of these characteristics”, they will abstain.

The spokesperson for EH Bildu, Adolfo Araiz, has indicated that there are aspects of the update with which they do agree, such as the inclusion of Tobin and Google rates, although Navarra has clarified, “it must apply the same substantive and formal rules as those established at all times by the state”.

There are other changes that also seem correct in relation to the inspection powers and VAT adjustments, which “are technical changes that have been claimed from Navarra for a long time.”

However, he stressed, “there is a change that worries us, and a lot, and it is what refers to financial relations, because from now on the Parliament of Navarra will lack voice and vote when establishing the imputation index that is applied to calculate the contribution of Navarra to the general charges of the State “.

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George Holan

George Holan is chief editor at Plainsmen Post and has articles published in many notable publications in the last decade.

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