After helping regional governments lower their debt objectives for the year, Spain seems ready to give Catalonia a chance to meet its budget goals -- though in an nontraditional way. Catalonia's foreign minister José Manuel García-Margallo said that the national government is considering transitioning the management of personal income taxes to the regions. In 2012 the personal income tax was 70,619 billion, more than the VAT or Impuesto de Sociedades, a major tax on companies.
If approved, the measure will threaten inter-regional solidarity in Spain by favoring Madrid and Barcelona, the two regions with the most jobs.
Further, it will give tax oversight authority to a region that is characterized by not meeting their budget objectives.
