Consumption, In Favor Of Lowering VAT On Basic Products
The general director of Consumption of the Junta de Andalucía, Agustín González Romo, has indicated that the proposal of the Vice President of the Government Yolanda Díaz to ‘bump’ the price of basic foods, “in addition to not complying with the law, it would not be a solution to the basic evil, which is to relieve the citizens of the rise in prices that has occurred as a result of inflation, since this rise in prices is not due to the whim of the distributors, but to the need to adjust prices to the increase of costs of the entire chain, such as the rise in the cost of energy, fuel and raw materials, aggravated by the war in Ukraine”, which is why, in his opinion, “the problem is being addressed badly”.
However, measures such as lowering VAT on certain products are seen as positive. “We must not forget that large companies also face this cost problem and that, however, they are already implementing price adjustment measures, such as the promotion of private label, adaptation of articles or their presentations” says Agustín González .
The general director also criticizes that Díaz’s proposal supposes “promoting by the Government, either in a compulsory or recommended way, the purchase of products in large surfaces, it can suppose a grievance against small businesses , and may suppose the erosion of the limited market share that local stores have, as various associations have already stated, such as the Association of Self-Employed Workers or the Spanish Confederation of Commerce”.
“Furthermore, capping prices can cause a market imbalance , since it would also affect the rest of the production chain, and could be a severe setback for the rest of the sectors, some such as agriculture or agriculture, which already They have been suffering great losses as a result of the increase in expenses”, adds the CEO.
The VAT route
In González’s opinion, the Government “should not burden itself with imposed measures that go against principles and rights such as free trade and free competition, especially when the answer is not there. It is curious that it speaks of capping prices instead of for example, reducing the VAT rate, something that would have a direct and positive impact on the citizen and would not harm trade , and I say that it is curious that they do not propose this measure just when we know that the Public Treasury entered almost 22,000 million Euros more than the last year.
In this sense, Agustín González clarified that, although it is true that there is already a reduced VAT rate of 4% and another of 10%, it would be time for the Administration to demonstrate that it is the first to make a budgetary effort, lowering those products taxed at 21% or 10% and lowering the super-reduced 4%, and even completely exempting the super-reduced.
Measures to support families are defended, such as the school check announced in Andalusia
The director general gives the example of the Andalusian Autonomous Administration, since the president of the Board, Juanma Moreno, has announced that the Andalusian Government is going to allocate 20 million euros to help families with fewer resources with a school check of 100 euros for each son or daughter enrolled in compulsory education.
Thus, she explained that this check may be requested by families with incomes below 15,000 euros per year and that it is expected to reach some 200,000 Andalusian students in Primary, Secondary, Basic Vocational Training and Special Education. “These are measures that help those who need it most, these are direct and effective measures.”
