Better taxation in Spain

There's (finally) talk about raising the taxes on the rich in Spain. Compared to the US system, taxes in Spain are painfully easy to avoid. When I came here, I sat down with a Spanish tax advisor who walked me through all the ways that the wealth tax (which was still there at the time) and income taxes could be avoided to a large extent.

Given the level of tax evasion in Spain, I think it's unfair to raise taxes without significantly increasing enforcement.

Here's what Spain could do:

• All those loopholes? The US closed them as much as 20 years go. Go plagiarize the US tax code.
  
• Get rid of the 4 year statute of limitations for tax fraud. The US has a 3 year statue of limitations for unintentional mistakes (6 years for mistakes larger than 25% of income), but has NO statute of limitations for fraud. In Spain, as long as you stonewall investigators for a couple years in court (pretty easy with the slow court system if you have a decent lawyer), escaping prosecution is almost too easy.
  
• Require a government certificate for non-resident status. This would be similar to a NIE, but only for tax identification purposes. Allowing people to register bank and investment accounts just by passport number is stupid. Eg if you have good enchufe at your bank, it's still possible to get a non-resident account, even as a Spaniard. If you have a non-Spanish passport, even easier.
  
• Require deductible business expenses to be paid by bank transfer or credit card. Sure, businesses can still hide cash income, but at least their business customers have the incentive to not pay in cash.
  
• Require bank transfers (at least within Spain) to be free of charge.
  
• Don't allow big ticket items like cars to be paid for in cash.
  
• Institute a "finders-fee" for reporting tax fraud. Snitches would get paid a percentage of taxes recovered.
  

Unintentionally funny hat day

Last time I was in the US visiting HQ, I picked up a Pixar hat for my son, since he's such a huge fan of pretty much every movie they've ever made.

Yesterday was field trip day and he had to bring a hat, so of course he took his Pixar hat. The other kids absolutely loved it, not because they like the movies too, but because pixar in Catalan means to piss. At least they didn't laugh at him, they just thought it was really cool.

I imagine at the beginning of every Pixar movie the Catalan kids start giggling...

Confusing our Caja

We've had an account for a long time at one of the larger Spanish cajas for various reasons, including the fact that we have some major enchufe with one of the managers, and thus give us kick ass interest rates on our term deposits.

Unfortunately, the local Sant Cugat office gets completely confused every time we go there, since our profiles are complete outliers. First, there's the fact that due to our "beckham-tax" status, our account is an extranjero account. Then there's the fact that my account is registered to my US passport (prior to moving here I didn't bother getting a European passport). Then the address is still in the US, since you can't be an extranjero and have an address here.

So today we bought a car. Well, we actually bought it two months ago, but things move slowly here. The car finally arrived, and the salesman phoned us to tell us that unless he got our money, he wouldn't be able to register it.

"Is a bank transfer ok?"

"Well there is a commission..."

"What about cash?"

"No commission"

So we wander over to our poor little caja where the lone teller is twiddling her thumbs staring forlornly at her family pictures arrayed artfully on her desk.

She looked at me suspiciously, warily awaiting another crazy request that would push her far beyond her comfort zone.

"We like X thousand euros in cash please"

Ugh.

Luckily today was armored car (or blinded car as they call it here) day, so they had the money, but in 20 euro bills. I never realized how much space 20 euro bills take up.

With a shopping bag full of 20 euro bills I walked over to the car dealer and paid up our car. It only took him about 20 minutes to count the cash. It looked like he had a lot of practice. In fact, the most time consuming aspect concerned him trying to hit up the other salesmen for change for my last 20 euro bill.

Makes you wonder if being a bank robber is really the best career choice when the car dealers seem to have wads of cash laying around.

In a mere three or for days it should be ready to pick up.... oh what fun...

Anti Euro-silliness

It's become fashionable lately to talk about how the Euro was a mistake, since having Euro-zone countries pegged to the same currency doesn't allow for imbalances to be resolved by changes in exchange rates.

Sure, in an ideal world, this could work, but in the real world, there's nothing stopping people and companies from getting loans or borrowing money in whatever currency they feel like. If Germany had kept their interest rates extremely low, most likely borrowers in the rest of Europe would have started taking out their mortgages in German Marks.

It would be impossible to devalue the currency at that point without bankrupting half the population. To make things worse, in a crisis situation, a relatively small economy like Spain would be unable to defend its currency and would most likely fall to currency speculation, causing an enormous amount of collateral damage.

Stupid referendum on Diagonal in Barcelona

It's pretty obvious to anyone who's spent time in Barcelona that the middle section of Diagonal is in serious need of some kind of change.

The government of Barcelona had the brilliant idea of doing a referendum to decide which option to take. Naturally, most anyone living near the soon to be reformed Diagonal voted "none-of-the-above" (who wants to be stuck in construction hell for 2 years?). Most of the other people couldn't be bothered to vote, so the end result was 80% for "none-of-the-above" with 12% voter participation.

For me, the point of representative government is to make the difficult choices, and be voted out of office if you are wrong. If you just want to make the easy choice, just hire an opinion polling company and save everyone a bunch of effort and money.

Back in business!

Lacking fresh milk in the fridge has meant cutting back on one of my favorite mantivities, ie drinking milk from the carton.

Not only are the UHT cartons pretty much impossible to drink from (if you don't believe me, at least poke a hole in the top before you try), but the UHT milk itself tastes kind of disgusting unless you mix it with coffee or some other strong flavor.

So I went to the local milk dispenser machine in Valldoreix yesterday. It's next to the bottled drink store on Rambla del Mossèn Jacint Verdaguer, with a big statue of a cow on top of it... you can't miss it. I opened the milk compartment, held my 1 litre container up to the dispenser and stuck in the matching 1 euro coin. 20 seconds later my container was full. I jumped back into my highly illegally parked car and zoomed home.

It's just too bad that my sister doesn't live here anymore, otherwise I could annoy her with a loud "ahhhhh" after chugging down a couple mouthfuls of cool fresh milk.