Canary Islands will appeal to its outermost region status to subsidize the Personal Income Tax of its workers

The proposal to modify the Economic and Fiscal Regime (REF) seeks to ensure that not only companies located in the Canary Islands benefit, but also their workers.

EFE

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EFE

November 20 2023 (12:00 WET)
People working installing solar panels.
People working installing solar panels.

Canary Islands will appeal to its status as an outermost region of the EU when requesting the Spanish Government and the Community authorities to accept its approach to modify its Economic and Fiscal Regime (REF) in order to subsidize the Personal Income Tax of people working in the Islands.

This was stated this Monday by the Vice President and Minister of Economy of the Government of the Canary Islands, Manuel Domínguez (PP), and the commissioner of the autonomous community for that law, José Ramón Barrera, before inaugurating a meeting on the modernization of the REF in which representatives of the Association for the Progress of Management, the tourism company Lopesan and the investment firm Casticapital participated.

Barrera insisted that this proposal, which has been criticized by opposition parties, who believe that the REF should be used more to encourage business investment than to cause tax savings for taxpayers, which will have an impact on regional budgets, seeks for the Canary Islands jurisdiction to "put a businessman from the Canary Islands in the same situation as one from Soria, but also a worker from the Canary Islands with one from Soria".

"We are going to see what the limitations are, which there are, if we manage to solve them and if it is possible to implement it or not in that new model of REF of the future that we want to build," he said.

Barrera has admitted that there are "legal limitations, in terms of the technique to be used; in terms of fitting into the current regulatory framework, where Europe is the main protagonist, and also the budgetary limitation".

However, he stressed that the Canarian Government of which he is a part, with the rank of councilor, "will not stay in those limitations, but will look for a solution".

On this issue, the Canarian Vice President and Minister of Economy, Manuel Domínguez, considered that "what the REF needs is to be known by the population in general, politics in particular and by the business sector in greater depth, for which modifications are needed to make the citizen notice it in first person".

"We have proposed that through Personal Income Tax there are competitive advantages for working in the Canary Islands, a differential is recognized with respect to the rest of the national territory so that we have our REF much closer and that it is one of those competitive advantages that allows the creation of jobs" in the islands, he asserted.

For Domínguez, "the most important thing is that Canarians have a higher per capita income and greater consumption capacity over time".

Manuel Domínguez estimated that the fact that the Canary Islands is an OR helps "to be understood more accurately from Europe, which has a lot to say in any modification or proposal that is raised from the REF", which his regional government "claims as a right, and not as an advantage".

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