| MADRID, Sept 29
MADRID, Sept 29 Spain's acting government aims
to raise 8 billion euros ($9 billion) by year-end as it battles
to meet deficit goals by requiring companies to pay more of
their tax bill upfront, a spokeswoman for the Treasury Ministry
said on Thursday.
The ministry has been briefing political parties on the
plans for the tax overhaul, which is due to be signed off in a
decree by the cabinet on Friday, the spokeswoman said,
confirming reports in Spanish newspapers.
The caretaker government, run by the conservative People's
Party (PP), had previously projected it would get 6 billion
euros from the tax changes.
Spain is maneuvering to avoid a potential fine from the
European Commission for failing to do enough to trim its deficit
at a time when a political deadlock is heightening uncertainty
over how well it can control the budget.
Parties have been unable to forge a workable government for
nine months after two consecutive national elections left Spain
with hung parliaments. That has hampered plans to draft a new
budget for 2017 in line with deficit goals and means 2016's
budget will instead be rolled over.
Brussels recently relaxed Spain's deficit targets for 2016
and 2017, but even as economic growth powers ahead, doubts are
growing over how even these new goals will be met.
The Bank of Spain forecast on Thursday that the deficit
would end 2016 at 4.9 percent of output, very close to the 5.1
percent deficit of 2015 and above the 4.6 percent set by the
"If new measures are announced, the target would be more
achievable ... but we're not in a position to assess whether
these measures will be enough," the central bank's director
general for economics, Pablo Hernandez de Cos, told a news
conference when asked about the tax changes.
He warned Spain needed to curb public spending with a more
"restrictive" budget policy to meet deficit goals.
Corporate tax income has slumped this year after a reform by
the PP which, as of 2016, meant businesses paying their taxes in
installments did not have to pay a minimum established amount
every time and could settle the balance much later on.
The PP now aims to reintroduce this minimum threshold for
each installment, setting it at 25 percent of banks' profits and
23 percent for companies, the spokeswoman said.
This will affect businesses with more than 10 million euros
in sales, around 9,000 firms. The bill, which has angered
business lobbies who warn it could endanger some companies'
solvency, will still need parliamentary approval.
(Editing by Paul Day and Alexandra Hudson)