Sunday 2 December 2007

PP's taxation reality.


Rajoy during his party's convention last week announced, out of the blue, that if PP wins the election, he will cut taxes. Not much of a surprise for a right-wing party to say something like this, right? it is one of their favourite tools when election time comes. What worries me is that he announced tax cuts at the same time as promising free nursery school across the country. How is he planning to pay for them if he cuts taxes? I'll tell you how, either he doesn't build them (it wouldn't be the first time they break an electoral promise) or a PP government will take public finances into deficit again after four years of superavit with Zapatero.
However, that it's not the worst case scenario, neither the most probable. What is most probable is what has happened in Salamanca under the local PP government. They raised taxes and they lowered public services. That is the reality of PP taxation strategy.
Today 30.000 people have demonstrated in front of the town hall against the tax increases taken by the PP local government. Taxes have gone up 42% on bus passes, 16% on property and 34.8% on waste management without clear improvements say locals.
Last week polls showed that people believed Rajoy was promising tax cuts as a populist measure rather than as a thought-through policy coherent with a wider programme. It's sad not just that he is gambling with public finances in times of global economic uncertainty, but that the so far only policy put out by Rajoy in four years in opposition is unpopular as well as the opposite of what his party's elected officials are doing somewhere else.

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