14 dic 2016

The tax measures adopted by the Government will affect investment and employment

At today’s meeting, the Board of Directors of CEOE analysed the consequences of the latest economic measures adopted by the Government and assessed the progress of the negotiations related to the Agreement for Employment and Collective Bargaining (AENC) that are being carried out with the unions.

The tax measures adopted by the Government will affect investment and employment

Fiscal measures

In relation to the announcement that Royal Decree-Law 3/2016, dated December 2, related to the adoption of several tax measures, will be validated tomorrow, December 15, in a plenary session in Congress, we reiterate our opposition to the tax increases included thereof, as well as to its processing as a Royal Decree-Law.

The tax measures adopted aim to reduce the deficit by resorting, once again, to an increase in corporate taxes, imposing a tax burden on companies, especially social contributions, that is already higher than that of many other European Union countries.

The easy alternative of raising taxes, instead of reducing the non-productive expenditures of the Administration, is a short-term and short-run policy.  The latter would make it possible to reduce the deficit without affecting negatively on the growth of enterprises and the increase in employment.

On the other hand, the changes included in the Royal Decree-Law, in many cases, affect investment decisions taken months ago and make it impossible for companies to estimate their fiscal costs or the valuation of investments to be made. This uncertainty, coupled with the high fiscal pressure, creates an unfavourable environment in our country to both domestic and foreign investment, which stands out even more in light of the announcements made in other countries of a reduction in corporate taxes.

Negotiation of the Agreement for Employment and Collective Bargaining (AENC)

In relation to the negotiations related to the AENC, business organizations and trade unions pledged to establish a new salary recommendation for 2017 taking into account the evolution of GDP in 2016 and the Government's macroeconomic framework for 2017, which will be specified within the three months following the publication of the latter.

Several meetings have been held in which CEOE has expressed willingness to not only reach an agreement on this matter, but also to discuss a series of issues that are strategic for the competitiveness of companies, the economic development of Spain and the creation of employment.

These include: reform of the Workers' Statute, training, collective bargaining, the role of the social agents, the Economic and Social Council, autonomous conflict resolution systems, prevention of occupational risks, employment services, mutual insurance companies that collaborate with the Social Security or the Social Security system. On these matters we are waiting to receive the trade unions’ proposals in order to continue advancing in the negotiations.