Fun question

Why does this matter?

Catalonia’s separatists looked increasingly isolated as the region’s biggest bank announced plans to leave and political pressure rose in both Madrid and Barcelona to bring the standoff to a head.

“It’s very sad what we are seeing, the departure of extremely important companies from Catalonia,” Economy Minister Luis de Guindos said at a press conference in Madrid on Friday. “This isn’t the fault of the companies. It’s clearly the fault of irresponsible policy which at the end of the day generates uncertainty and anxiety.”

Corporate tax is paid to the central government, isn’t it, not the regional?

24 thoughts on “Fun question”

  1. The point –surely–of being a separatist is to be on your own?

    And as for the bank caper, are we to believe this was a spontaneous decision taken by the bank execs?

  2. Interesting evidence for the Scot Nats that the threats made during Indyref (which they dismissed) that UK companies like Bank of Scotland and Standard Life would relocate their head offices out of Scotland were probably real

  3. The catalans expected to take on the CIT from companies located in Cataluña. The craziest would want to nationalise them.

    These companies want to be in the EU (ie Spain, not a newly independent and out of the EU Cataluña), where 90% of their market is. Spain is far and away their biggest market. Most of their shareholders, customers and employees are in the rest of Spain.

    The politician in favour of independence said this would not happening and it is happening before their very eyes. Some are already turning. The previous President of the Generalitat Artur Mas turned yesterday.

    Maybe this is what Rajoy expected and has provoked?

    It will kill this dead, there might be some wonderful scene-setting and grand declarations, but….

  4. To answer a question with a question, to whom?

    Tax is not the driver for Catalonia, necessarily or directly. Where your head office is tends to drive lots of senior jobs, and then lots of junior jobs supporting the seniors. It can be very important indeed – the losing headquarters in a big merger can make a big difference to a town or state.

    But not always. A head office in Zug or similar typically drives one senior and a couple of secretaries, and a couple of board meetings a year.

    For these banks, it’s prudent to manage a big risk – that they wind up as non-EU headquartered after independence, so suddenly and chaotically, with all sorts of risks and worries and licensing problems. Catalonia would be not just a third country, but one without a central bank.

    They still have the option whether to move the bulk of the head office over time, or just treat it like the Zug approach. So it makes sense.

  5. Its the property taxes, wages etc that all add up.
    I spend money where I am most commonly – OK the bills are paid where the bills exist so different towns and cities, still leaves a lot of discretionary spending each month on a local basis.

    Take away the banks from the City what would London have? Lots of support staff and companies for people that live elsewhere?

  6. Bloke in North Dorset

    The threat isn’t independence per se but an ill thought through UDI. Those banks had to move quickly because they didn’t know what was on the other side.

    Brexit may or may not be a pain in the arse for big companies but at least its taking place under a semblance of order and whether they like it or not the worse case scenario (or best case depending on your PoV) is a WTO based free market country.

  7. Solid Steve 2: Squirrels of The Patriots

    I’m no fan of Catalonian secessionism, but as a huge fan of mischief I’d advise them to declare UDI immediately. Waiting out this week was a mistake, as they are now seeing.

  8. Good opportunity for regional banks to put the boot into the national and international ones and win some business.

  9. ‘Economy Minister Luis de Guindos said at a press conference in Madrid on Friday. “This isn’t the fault of the companies. It’s clearly the fault of irresponsible policy which at the end of the day generates uncertainty and anxiety.”’

    Madrid’s policy. Should Madrid say, “Okay, you voted out. We can still be friends. Bye, bye,”
    there would be no uncertainty and anxiety. It is Madrid that is fighting the people’s democratic decision.

    [Being a South Carolinian, I’d notice that. We went through the same shiite here 150 years ago.]

  10. “…whether they like it or not the worse case scenario (or best case depending on your PoV) is a WTO based free market country.”

    Brexit + Corbyn is a far worse scenario, and alarmingly possible.

  11. “A new law approved by the cabinet on Friday eased the way for companies to change domiciles,”

    Approved by the cabinet? hmmm i may not be so keen on being under the spanish constitution either.

  12. Whatever the politics, shifting the head office of the bank to the jurisdiction where it’s centre of gravity lied is just plain common sense.

  13. You Brits are having a problem thinking clearly about these Catalans because you have not yet adopted a joyfully derogatory name for them.

    Dago? Wog? Already taken. Get busy please. Or will Plod pounce should you do so in these degenerate times?

  14. Solid Steve 2: Squirrels of The Patriots

    You Brits are having a problem thinking clearly about these Catalans because you have not yet adopted a joyfully derogatory name for them.

    Mountain Wops.

    Barcemoaners.

    Manuels.

    Olive Geordies.

  15. As an aside:
    In the Basque Country we have our own tax authorities who raise all the major taxes (some small special taxes are a national affair ) and pay a ‘cupo’ or mutually agreed fee to the state for foreign affairs, defence etc.

    The Catalans don’t have this and they have realised that this is advantageous for the Basques. If the radicals hadn’t whipped up such a fever and got all the less politically savvy on their side this would have been a way to go.

    This does mean that as we have three tax authorities (one for each of the three provinces) for only 2.5 million people, if you fart they get wind of it, if you see what I mean!

    In my province, the BBVA and Iberdrola (owner of Scottish Power) are domiciled and their Company Tax return saves the budget.

  16. Just a reminder:

    Catalans have not voted for independence.

    Every election, the false referendum of 2014 and this one, always under 50% of the electorate.

    And remember the ‘remainers’ don’t vote in illegal referenda

  17. ‘Every election, the false referendum of 2014 and this one, always under 50% of the electorate.’

    It’s not the number that voted that counts, it’s what the ones who did vote voted for.

    “False” referendum? When will the valid one be held? Or is it only valid if “remain” wins?

  18. Clearly, Remainers aren’t as motivated to fight their way through baton-wielding police lines to vote in an unofficial election.

    So we’re left with the strong suspicion that the majority of Mountain Wops are Remainers and that a mobilised minority is trying to give them the bum’s rush.

  19. I just chucked this on yesterday’s thread, I’ll repeat it here:

    Why not offer a formal referendum? Give it a 3 month period, to allow common sense to influence stuff. Madrid not to lie (ie don’t copy the Remainers). If what you say is true, the vote will be against and the independence wallahs will have nothing (for now), like the SNP?

    It seems to me that Rajoy has simply played very badly into their hands?

  20. The banks are off.

    Next it will be people. Non-Catalans aren’t going to want to live in a state that will be grossly anti-Spanish.

  21. “It’s not the number that voted that counts, it’s what the ones who did vote voted for”. Nope.

    On this Stalin was sound: “The people who cast the votes decide nothing. The people who count the votes decide everything.” Who counted the votes?

  22. PF

    ‘It seems to me that Rajoy has simply played very badly into their hands?’

    Rajoy was unsure as to which of his paymasters wanted what result as the man is corrupt to the core, keeping all his important benefactors happy is a conjuring trick beyond his limited intellect.
    This whole Catalan Independence thing is a competition over the spoils of graft.

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