20/09/2013 00:00
TW
0
By Jason Moore OFFICIAL figures for the European Union out this week said that Spain could be the last major economy in the European Union to come out of recession. This is obviously bad news not helped by the fact that the Spanish government is also planning to raise taxes in the New Year along with the VAT rate. Added to this is the new ban on smoking which is being considered for all public places. Higher taxes at the time of a recession are like giving an arsonist a box of matches, it is only going to make the problem worse.

The Zapatero government should be considering lowering taxes until the recession is over. But the Spanish Prime Minister has some important economic worries including the unemployment benefit bill which continues to rise as Spain heads for a jobless rate of 20 percent. Business leaders and the opposition, Partido Popular, are deeply concerned and are calling for an early election. They have accused Zapatero of not having a proper economic plan. This may be the case and I do believe that the Spanish government was rather caught by surprise by the scale of the recession. Zapatero should be working more closely with the unions and the employers because otherwise Spain risks being in financial crisis for years to come.