It looks like there will be an increase in capital gains tax if the government has its way, this according to an announcement by prime minister José Luis Rodríguez Zapatero. They are responding to an ever widening GDP problem in the country.

Quite simply because of declining government income combined with increased spending they are unable to balance the national books.

According to the prime minister this is a “crisis” that some within Spanish society will need to help resolve. All year the government of Mr. Zapatero has been avoiding any kind of tax hike but now state that there is no other way to balance the books. He went on to say that he does not envisage the majority of Spain’s tax payers being affected as he has no plans to increase income tax.

Although he did also for a warning shot that it may be possible that the income tax deduction amounting to €400 per citizen, and only introduced 20 months ago, may be reversed.