SANTA CRUZ DE TENERIFE, July 30 (EUROPA PRESS) –
The participation of the Canary Islands in the common stock of regional financing will grow by 23.4% next year, reaching 6,576.2 million euros, an amount that includes the advances on account for 2023 that the Islands will receive and the settlement of the fiscal year 2021.
This has been reported by the Minister of Finance, Budgets and European Affairs, Román Rodríguez, according to the calculations made after the participation in the Fiscal and Financial Policy Council held last Wednesday in Madrid.
The recovery of the economy and, consequently, the higher tax collection due to growth, coupled to a lesser extent with inflation, have increased the resources available in the Autonomous Financing System (SFA), which is nothing more than the distribution that carried out by the State between the autonomies so that they can provide essential public services.
Román Rodríguez explained that the sum of state revenues account for approximately 70 percent of the budgetary resources of the Autonomous Community, which gives an idea of the relevance of these transfers for the sustainability of public services. The income from the Canarian fiscal instruments, with 18%, and the European funds, with 12%, complete the table of income of the Autonomous Budgets.
These increases were already largely contemplated in the Budget Plan and Scenarios for the 2023-2025 triennium approved by the Government of the Canary Islands on April 28. Specifically, the settlement corresponding to the year 2021 was fully planned. Advances on account, on the other hand, were considered, although not in their entirety, since the State’s forecasts have varied according to the evolution of the economy.
The procedure followed by the central government for the distribution of amounts on account consists of calculating amounts, based on the estimate of tax revenue for the following year, which are advanced to the autonomous communities. After two years, the Executive makes a liquidation, so that, if the autonomies received more money than they were entitled to – based on actual collection data – they must return it; otherwise, the State will pay them the difference.
This circumstance explains why the regional budget laws reconcile two financial “realities” that refer to different years; on the one hand, advances on account, which are calculated based on the estimate for the following year (in this case, 2023), and settlements, which are made two years late with respect to the current budget year (in this case, 2021, which is transferred in 2023).
GOOD SCENARIO AND BETTER BALANCE
The vice-president once again stressed that the forecast of state income, together with own fiscal resources and European funds, constitute a good starting point for the elaboration of expansive Canarian Budgets in economic terms and continuity in political terms.
“We will have more resources, but we will use them to maintain the same policies that we have applied in the previous three years of enormous economic difficulties for all; that is, to maintain essential public services, to protect families and companies that are having a hard time. and to boost the economy, boosting demand and employment”.
Rodríguez highlighted the response of the Government of the Canary Islands to the successive crises that have been taking place in recent years and guaranteed its continuity next year, as long as the current difficult conditions continue, with a crisis derived from COVID that has not been definitively buried and with the price escalation caused by the breakdown of global supply chains and exacerbated by the war in Ukraine.