Families with income up to 14,000 euros will receive a check for 200 euros

The Government has approved this Saturday in an extraordinary Council of Ministers a new plan to combat the effects of inflation that extends until December 31 the measures already adopted in March and incorporates new ones, such as a single check of 200 euros for workers, self-employed and unemployed, as announced by President Pedro Sánchez at a press conference. In the Twitter social network, the third vice president, Yolanda Díaz, has later clarified that this aid will reach the families with annual income up to 14,000 euros.

The new plan presented by Sánchez will have a budgetary impact of just over 9,000 million euros, as estimated by the president, as a result of the measures that will entail greater spending “to protect families, working classes and specific sectors” (about 5,500 million) and the new tax cuts (about 3,600 million), among which are included the cut from 10% to 5% of VAT on the electricity bill until December 31 and the extension of the previous ones. This new plan, added to the March one (with aid for 6,000 million) should serve, according to the Prime Minister, to prevent inflation from being 3.5 points higher than in the absence of both. “If these measures did not exist, inflation would approach 14 or 15 points,” said Sánchez. The budgetary effort of both packages is estimated at around 15,000 million -“something more than a point of GDP”, according to Sánchez- to which another 10,000 million in ICO credits for companies should be added.

In addition, the president has announced “a new tax” on windfall profits of the energy companies that will be required from January 2023. The design of this new tax, about which no details have been advanced, will be incorporated into a bill that the socialist and United We Can groups will present in the Congress of Deputies “in the coming weeks.” The objective, he has said, is to “guarantee a fair distribution of burdens” that is causing the high level of energy prices. “It is not possible for some to benefit at the cost of the sacrifice of the majority”, he has said.

After the president’s press conference, from the Government itself it has been clarified that the idea is to set the accrual of the tax on December 31, 2022. Therefore, “the new tax would be payable from January 1, 2023 , but it would affect the 2022 financial year”, it has been clarified.

The plan presented by Sánchez includes a 50% reduction in transport passes provided by the State and 30% of all subscriptions that are managed by the autonomous communities and local councils. The president of the Government, Pedro Sanchezhas announced that the coalition Executive will pay for this measure from September 1 to December 31 of this same year.

Sánchez explained that the Government will provide the necessary resources to reduce monthly subscriptions or any transport title that is managed by the State by 50%. In this sense, he has given the example of Renfe season tickets. In addition, on the transport that is in the hands of the autonomous communities and the municipalities, the Executive will contribute the amount necessary to reduce them by 30%. However, the autonomies and local entities may complete this reduction up to 50%.

The coalition Executive has approved it in a Minister council extraordinary event held this Saturday in which they have carried out a new royal decree law with economic and social measures to deal with the economic consequences of the invasion of Ukraine and the rise of inflation. As explained by Sánchez himself, this new package represents an expense of more than 9,000 million euros and they trust that it will serve to curb inflation by 3.5 percentage points.

dim the light

Among the new measures that have been included in this royal decree is the reduction of VAT on electricity, from 10% to 5%. This last measure will cost the State coffers 220 million euros per quarter. According to the calculations of the Executive, the total cost of reducing VAT from 21% to 5% amounts to 600 million euros per quarter and reaches 1,800 million euros per quarter if the rest of the measures that have been carried out are included. previously: the extension of the reduction of the special tax on electricity and the suspension of the tax on the value of electricity production.

Related news

The Chief Executive has also announced that they will process the creation of a a new tax to tax the extraordinary profits of electricity companies. This has been one of the main disputes within the coalition government, since United We Can demanded that a similar figure be put into operation immediately. On the other hand, he pointed out that the Executive will limit the maximum price of the butane cylinder and that will continue until the end of the year the bonus of 0.20 euro cents per liter of gasoline.

Other measures

Sánchez has also confirmed that the royal decree approved this Saturday includes the revaluation of the non-contributory pensions 15%. This is one of the measures that the coalition government agreed with EH Bildu. On the other hand, they have approved a direct aid of 200 euros for workersself-employed and unemployed with “low income” that can be requested from the month of July.