PM announces one-off bank tax and free passes for local trains

Pedro Sánchez in Parliament last week. / EDUARDO PARRA/EP

Pedro Sánchez bolstered support for his government from minority leftist and nationalist parties during this week’s State of the Nation debate

Prime Minister Pedro Sánchez this week unveiled a series of new compromise measures aimed at softening the blow from inflation. The announcements came amid a state of the nation debate in the congressional chamber.

The PM’s left-wing allies in his cross-party coalition and his friendly nationalist parties have rallied in support of the government despite tensions between them in recent weeks and amid signs they will seek more sweeping concessions from Sánchez in the future. in order to maintain their support for him.

Sánchez admitted that difficult times awaited him, but said he would do everything to defend “the social majority” and take the difficult decisions that Spain “must be made”.

The new measures include an additional two-year tax on banks, which will bring in around 1.5 billion euros a year, on top of the already announced tax on large electricity, gas and fuel companies on their profits. extraordinary in 2022 and 2023. “This government will not allow many people to suffer for the benefit of a few others,” Sánchez said.

Banking shares have plunged into the news and the government has vowed to try to stop banks passing the tax on to customers with higher charges – and so defeating the purpose – though that the experts said would be difficult to do.

The government will also grant a 100% discount on Renfe rail passes for local Cercanías services and medium-distance trains. Until now, the discount was 50%, but it was increased to encourage people to use public transport.

Sánchez also announced that students over the age of 16 who already have a scholarship will now receive an additional 100 euros, payable between September and December this year.

Even though July is normally sweltering, Spaniards have had to deal with unusually high temperatures this week. Red weather warnings have again been activated for large parts of the country, including Andalusia. The province of Malaga, however, remained cooler.

In Ourense, in the northwest region of Galicia, temperature signs showed up to 49 degrees on Tuesday and parts of the north were experiencing the hottest July weather in 50 years.

Emergency services have advised vulnerable people to avoid leaving the house.

The unusual heat wave was caused by high pressure centered over the British Isles and forecasters said it would start moving away again from this Saturday.

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