Spain Business
Partido Popular VAT/IVA rebellion defeated in Congress
By h.b. - Mar 17, 2010 - 5:38 AM
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José Luis Rodríguez Zapatero, María Teresa Fernández de la Vega, and Elena Salgado, during the debate on Tuesday - EFE
The Government won the day but by only six votes
The Government managed to get past the anti-IVA/VAT increase rebellion organized by the Partido Popular in Congress last night, and the rates will now definitely go up on July 1. The standard rate will increase from 16% to 18%, while the reduced rate will go from 7% to 8%.
The PNV Basque Nationalist Party and the CC, Canary Islands coalition supported the Government in the vote, rejecting the motion presented by the Partido Popular who finally obtained the support of the Catalan CiU and the left wing groups, ERC, IU-ICV and the mixed group.
The Partido Popular had made a call during the previous debate for the deputies to vote on the conscience on the matter, with Cristóbal Montoro from the PP claiming the increase would bring more recession and unemployment, but finally the Government succeeded in defeating the motion by only six votes. The Government’s argument was the need for ‘solid income’ to reduce the deficit.
Check out the new IVA/VAT rates - here