Pictures

On 19th June, the ESADE Alumni Law Club and the Committee for New Initiatives of Círculo Ecuestre hosted a lunch discussion on the present and future of property and inheritance taxes.

By coincidence, this debate coincided with Esperanza Aguirre's proposal, announced during her investiture speech as President of the Autonomous Community of Madrid, to include the property tax in her list of tax cuts. Prior to the discussion, Eduardo Berché, Professor of Financial and Tax Law at ESADE-Ramon Llull University, welcomed the audience. He noted that 'the property tax was designed with the clear intention of increasing tax revenues, and many countries have been repealing it in recent years'. According to Professor Berché, inheritance taxes present a similar situation. Their unequal application in Spain has divided the country into three regions with different situations.

The first speaker, Jordi Turull, discussed the position of his party, Convergència i Unió (CiU), with respect to these taxes. 'We believe in policies that stimulate the economy', he said, adding that CiU had proposed 'a selective reduction of certain taxes, especially those which affect the middle class and industry'. Specifically, CiU proposes 'the creation of a regular property tax exemption of up to 300,000 euros and the revision of the rates' and ?the de facto abolition of the inheritance tax'.

Antoni Comín shared the vision of the PSC, the party that currently controls the Catalan Government. He highlighted the fact that his party was willing to reform the inheritance tax to improve its horizontal and vertical equity. This reform, he said, would focus on increasing the minimum exemption in order to significantly reduce the number of people forced to pay this tax, and reduce the tax burden in cases involving estates passed between direct family members. This would be joined by an 'increase in the deduction for primary residences', with special consideration given to business activity, since the transfer of a family business should not be subject to a special tax, he said.

Patricia Gomà of Esquerra Republicana (ERC) focused her comments on similar considerations, with slight differences. She noted that, if the three tax-reform proposals that have been presented in the past six months had been accepted, the Catalan Government would have lost 1 billion euros in tax revenue. 'We must therefore approach the issue of tax relief with great caution', she said. Ms. Gomà added, 'ERC supports the reform of the inheritance tax in order to re-establish the equity of its application, mainly by approving major complementary and/or alternative reductions for the lowest income brackets, as a function of the amount of pre-existing property and the size of the estate'. She also noted that her party opposed repealing the property tax.

According to María Ángeles Olano, the Partido Popular is dedicated to creating 'a financially stable system with a stable budget'. She noted, 'We need to modernise the tax code. Without clear fiscal policy, investors will not come here'. The Partido Popular, she added, 'wishes to repeal the special property tax and the inheritance tax for estates passed between parents and their children or between spouses'. The abolition of the inheritance tax, she said, would be joined by 'an increase of up to 100% in deductions for the transfer of money, life insurance policies and primary residences' between the aforementioned family members.

Daniel Pi of Iniciativa per Catalunya-Verds roundly declared that 'lower taxes and greater competitiveness are not directly related'. He continued: 'Iniciativa is committed to a progressive property tax scheme that applies the highest rates to the largest fortunes'. He added: 'The inheritance tax should be a progressive tax that imposes higher rates on large fortunes than on more modest transfers'.

The discussion ended with a few remarks by José Domingo of Ciutadans (mixed group): 'For the property and inheritance taxes, the state should take real steps to prevent the crazy political race we've seen'. He then explained his party's proposal: 'Under the inheritance tax reform plan of Ciutadans, the minimum exemptions would be increased in order to avoid penalising the middle class'.

Programme

The ESADE Alumni Law Club is organising a lunch discussion featuring members of the Catalan Parliament's Committee on the Economy, Finance and the Budget.

Can an inheritance regulation be constitutional if it creates differences between the various autonomous communities?

Should we repeal the property tax, as most European countries have?

Host and moderator:
Dr. Eduardo Berché
Professor of Financial and Tax Law at ESADE-Ramon Llull University
 
The following members of the Catalan Parliament's Committee on the Economy, Finance and the Budget will participate in this discussion:
 
CiU: Jordi Turull
ERC: Patrícia Gomà
ICV: Daniel Pi
PP: María Ángeles Olano
PSC: Antoni Comín


Date, time and venue:
Tuesday, 19th June 2007
1.45 to 4.15 pm
Círculo Ecuestre
C/ Balmes, 169 bis
Barcelona

FINISHED ENROLMENT

Price of lunch: 45 euros

Method of payment:
Cash on the day of the event