The ERC demand regarding the management of the IRPF in Catalonia, which thwarted the previous attempt to approve the Salvador Illa Government’s budgets, has been put on hold for the moment, but in the meantime, the republicans have tried to negotiate to the limits of what is possible within the framework of the budget agreement to be announced this week to prepare the ground. Thus, the Catalan Tax Agency (ATC) will receive a clear boost with a specific program contract that will allow it to equip itself within three years (2026-2029) with the human and technical resources necessary to assume all tax functions related to the management of the aforementioned tax for taxpayers in Catalonia.
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Within the framework of the budget agreement, a specific provision will be included stating that “this program contract will be signed between the Generalitat and the ATC to guarantee a stable and defined relational framework” so that the tax administration has “stable funding” that allows it to promote “the necessary technological, process, data management, and organizational changes, especially in terms of collection.”
Although the budget to be approved by the Government this week will include an additional contribution of 21 million euros to strengthen the ATC, the program contract that the Executive commits to signing foresees a total expenditure until 2029 of 527 million euros, of which 481.2 will be transferred by the Department of Economy and Finance led by Minister Alícia Romero.
The agreement seeks to promote technological, process, management, and organizational changes for collection
These resources will finance, among other things, the costs of staff expansion, increased participation in income tax campaigns, and the cost of technological transformation projects required by the ATC for the mission demanded by the republicans and which Illa secured in the investiture agreement with the PSC.
The program contract will serve as a roadmap to achieve a goal intended to be reached through three stages, until the progressive assumption of IRPF competencies. This is an aspect that had been much debated, especially because the lack of resources of the ATC forced the Catalan Treasury to rely on the resources already available in Catalonia from the Spanish State Tax Administration Agency (AEAT). Against the socialists’ proposal for a tax consortium – rejected by ERC – the final solution involves an intermediate formula.
The first stage will be one of collaboration between the two tax entities. The ATC will develop information and assistance functions for citizens, particularly during income tax campaigns; initially, these will be carried out in collaboration with the AEAT, but the Catalan Treasury will progressively assume them until full adoption.
The Catalan Tax Agency will be equipped with a three-year program contract (2026-2029)
Then there will be a stage of “partial management,” in which the ATC would have the capacity to issue administrative acts and perform management, inspection, and collection functions in defined areas and could even sanction within the scope of the acquired competencies. The final stage will be full management, in which the ATC will assume the exercise of all tax functions related to the management of the IRPF (management, inspection, collection, review, and sanction), regardless of the income on which taxes are paid.
To strengthen and modernize the ATC to the required level, the transformation must be in five areas, according to the agreement between the Government and ERC: governance, organization and personnel, processes, data, and technology.
The Government will create a governance technical office to coordinate and analyze the entire process, and to prepare the necessary human resources, the structure will be renewed under three general directorates, the tax bodies’ staff will be reinforced, territorial implementation, as well as training and career plans.
Three stages have been outlined, and in the first, the Spanish and Catalan tax entities will collaborate
Digitization will focus the transformation of processes, and regarding data management, a specialized unit will be created. Finally, it will be necessary to have an integrated technological platform, which will have the SAP system as the management core.
