The Mayor of Barcelona, Ada Colau, met representatives from the city’s culture and research sectors to form a common front and call for a review of VAT being claimed on public subsidies.
Before the change in VAT jeopardises the economic feasibility of various facilities, the Mayor showed a firm commitment to work shoulder to shoulder with those affected and offer them institutional support. “These sectors are cornerstones in terms of knowledge, but also in terms of our city’s social and economic fabric. We need to give them maximum support as they are common assets for democratic life”, affirmed Colau.
On behalf of Barcelona City Council, the Mayor called for a meeting with the Spanish Minister for Finances and Public Administrations, Cristóbal Montoro, “to resolve this situation of uncertainty as soon as possible and so that these resources can be used for the benefit of the city”, noted Colau.
The City Council has been working with experts from the sectors involved and the Government of Catalonia for some time now to bring about a change in the provision of the Act on contracts. These efforts focus on the payment of VAT on public subsidies for culture and research not being retroactive, meaning backdated payment is not required.
Initially this question was clear-cut, by Spain’s Inland Revenue Tax Authority has maintained inspections of cultural facilities to demand the 21% VAT on state subsidies awarded between 2013 and 9 November 2017. This has set the alarm bells ringing again, prompting uncertainty and concert among the sectors affected as they see their projects jeopardised as a result.