Opposition to Increases in IVA Overturned

The Spanish government managed to surpress the Partido Popular’s opposition in congress yesterday, against the increases in IVA (VAT) that are now certain to take effect on the 1st of July. The standard rate will increase from 16% to 18%, with the reduced rate increasing from 7% to 8%.

The Government had support from the PNV Basque Nationalist Party and the CC, Canary Islands coalition, However the Catalan CiU and the left wing groups, ERC, IU-ICV and the mixed group supported the motion put forward by the PP in opposition of the increases.

The PP had previously called for the deputies to vote on the conscience on the matter, with Cristóbal Montoro claiming the increase would bring more recession and unemployment to the Country, but finally the Government succeeded in defeating the motion by just 6 votes. The Government’s argument in response to this was for the need for ‘solid income’ to reduce Spain’s deficit.