reform of tax rules returns to the table this Thursday EU economy and finance ministers It is hand in hand with the new compromise proposal of Spain, which holds the EU term presidency this term, aiming to remove the obstacle to the agreement that has been resisting for months due to disagreements between capitals such as Paris and Berlin. To create the department, the Spanish vice president and economy minister, Nadia Calvino, called his counterparts to a meeting negotiation dinner It will start after the Eurogroup meeting and this it took all night until Friday. In the menu: minimum annual deductions For all countries with debt greater than 60% of GDP and fiscal buffers, even if the public deficit does not exceed 3%.
According to the distributed document, accessed by Grupo Prensa Ibérica’s El Periódico de Catalunya, it is the Spanish presidency’s intention that the dinner last as long as necessary “in order to reach a political agreement.” About pending matters.” draws attention to his note. “All we know is that our Spanish colleagues in Madrid and Brussels are only talking about Plan A and the existence of an agreement. “They are willing to stay here all night,” European diplomatic sources said. “We have made great progress in recent months. “I think there is a very good opportunity to close it in the near future and we are quite close,” other European sources say about the possibilities of signing the agreement between this Thursday and Friday. European Parliament.
Less debt and deficit
The new document prepared by Calviño’s team to finalize the agreement comes closer to Germany’s demands and details the promised security measures in numbers. debt and public deficit To ensure that countries not subject to the excessive deficit procedure comply with the harmonization pathways. For example, the new proposal on debt recommends that the most indebted countries, with a debt ratio of more than 90% of GDP, reduce their debt level slightly during the adjustment period. “at least an average of 1% annually GDP” 0.5% as long as they exceed the above-mentioned threshold (Berlin requirement) and for those with debt ratios between 60% and 90%.
referred to deficit protectionThe latest commitment drafted by Spain includes an additional threshold not foreseen so far. This is about a Fiscal buffer of 1.5% of GDP. So even if countries are not subject to a sanctions procedure, they will have to tighten their belts even if their fiscal deficits do not exceed the 3% of GDP limit. “The Commission’s technical track record will have to ensure that fiscal regulation continues where necessary until the Member State reaches a deficit level that provides a common flexibility margin of 1.5% compared to the 3% reference,” the document says. According to Spain, the aim is to guarantee a “budgetary room for maneuver” that will take into account the needs of public investments and reforms. To achieve this margin, the annual adjustment to the primary structural deficit would need to vary between 0.3-0.4% and 0.2-0.25%, depending on the adjustment period.
The proposal also maintains the minimum annual budget adjustment of 0.5% of GDP for countries with a deficit of more than 3% of GDP; However, it eliminates the budget deficit upon the request of countries such as the Netherlands, Austria or Germany. sanction accumulation limit 0.5% of expected GDP. “Positive” because “imposing a ceiling on sanctions sends a bad signal,” diplomatic sources say, reminding that the current system of larger penalties is not implemented effectively because it is too high. Even though the text shifts towards Berlin, there are still many elements that divide Twenty-Seven that need polishing. It is a matter of how to treat investments and reforms while extending the fiscal trajectory from four to seven years. The idea, according to sources consulted, is that the level of debt is an aggravating factor.
Calviño to EIB
Besides trying to reach an agreement on fiscal rules, the 27 will put another hot potato on the table this Friday: the next election President of the European Investment Bank (EIB) will replace Germany Werner Hoyer From January 1, 2024. According to diplomatic sources, Calviño’s path to this post is absolutely open, and the Belgian Finance Minister, as president
According to the same sources, silence procedure At the end of last week, the bid to support Calviño for the position and the recommendation to other delegations to withdraw their respective candidates ended. The Belgians’ conclusion is that the Spaniards have “enough votes” and this will be confirmed by van Peteghem at breakfast this Friday.
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