The validation of the anti-crisis decree approved this Tuesday by the Congress of Deputies consecrates, among many other measures, the reduction of VAT on basic foods as the formula to try to reduce the price of the shopping basket. However, although this tax exemption has been applied for some time (since the decree was approved in December), the political battle between the PSOE and United We Can on account of how to tackle underlying inflation caused by the cost of food continues more live than ever
The first to make a move was the second vice president of the Government and Minister of Labor, Yolanda Diaz. From the hand of the Minister of Consumption, Alberto Garzon, held a series of meetings with large distribution and food companies to try to agree on an affordable, varied shopping basket adapted to people with celiac disease. However, Díaz’s proposal was not successful, and most companies did not agree to voluntarily lower their prices.
In the negotiation of the anti-crisis decree, the vice president then opted for another path: prohibit the distribution of dividends and profits to large companies that did not lower their food prices. However, in the end, the measure that was included in the standard was the one proposed by the PSOE, that is, the VAT reduction on basic foods.
In Unidas Podemos they had been critical of this formula from the beginning, since they understood that large supermarkets could take advantage of the tax cut approved by the Government to further widen its profit margin, saving VAT without lowering the final price of the products that the consumer ends up paying.
In fact, in the confederal space they denounce that, despite the fact that some surfaces have lowered the price of their products, the majority have not. in the same margin as the VAT reduction and, in some cases, prices have not even been lowered.
This is why last week Podemos moved a proposal that seeks an effective reduction in the cost of food: the intervention of prices to limit them and place them at the same amount they had in February 2022, before Russia invaded Ukraine. and this war will begin at the gates of Europe.
Moncloa sees the VAT reduction as “effective”
In the purple formation they have insisted greatly on this proposal in recent days (along with the promotion of a guaranteed basic income from the age of 18) and have increased pressure on the PSOE to take them into account. “The path of change of this coalition government has to be consolidated because it is an example of how to face crises for the benefit of the citizenry and not of the powerful. We cannot give up, we have to go for more”, they transferred this same week their spokesmen.
The party, and Unidas Podemos, have focused on the historic benefits that large food companies and supermarkets are obtaining and last Saturday, during the celebration of the event for the ninth anniversary of Podemos, its general secretary, Ione Belarra, pointed out with first and last names Juan Roig, president of Mercadonawhom he accused of “filling his pockets” being “a ruthless capitalist.”
The PSOE criticized, as a party, the words of Belarra and this Tuesday the government spokesperson, Isabel Rodríguez, in the press conference after the Council of Ministers, valued the work of the food distribution sector and recalled that during the worst months of the pandemic maintained its services despite the difficulties. “We maintain a permanent dialogue with themis a sector that we have turned to now to carry out initiatives that have to do with lowering taxes on basic foods,” Rodríguez said.
The Minister of Equality and number two of Podemos, Irene Monterosupported the words of his general secretary this Tuesday and recalled that “in times of bipartisanship there were very powerful people who could not be named; now there is democracy and there are no unnamables.”
From Moncloa it is ensured that the VAT reduction is being effective and that there is data that supports that the vast majority of food distributors have lowered their prices after the approval of the anti-crisis decree, although they admit that there are some “very specific exceptions” that, in any case, “are a minority and are being pointed out” .
In Unidas Podemos they do not share this vision and, on the contrary, they consider that the VAT reduction is not being transferred in all its dimension to the price of food and that, in any case, the large distributors should pitch in and give up part of their historic profits to guarantee that families can access basic products such as fruit or fish.
The approval, first, and validation, later, of the anti-crisis decree and the reduction in VAT that it includes has not, in any case, stopped a political battle that remains open between the two partners in the Government.