The Canary Islands Government will once again deflate income tax in 2027 to ensure that inflation does not reduce the purchasing power of those receiving salary increases.
According to AtlánticoHoy, the Canary Islands Government will deflate income tax again in 2027. The announcement was made on Tuesday by Manuel Domínguez, the vice president of the regional government and minister of Economy, Industry, Commerce and Self-Employed, during the plenary session of the Canary Islands Parliament.
The measure will adjust the tax brackets to the evolution of prices. The aim is to ensure that salary increases resulting from inflation do not lead to a higher tax burden without a real improvement in purchasing power.
Domínguez argued that this formula prevents inflation from taking away part of the increase:
“not taking away the euros from the salary increase”from the Canary Islanders, according to his words.
The announcement came in response to a question from PSOE deputy Nira Fierro, who warned that 704,000 people are at risk of poverty or social exclusion in the Canary Islands. Fierro cited that 45.5% of those paying rent are in that situation and that 293,000 people are struggling to pay rent or their mortgage.
Domínguez responded that the Arope rate fell from 33.8% to 31.2% during the current term, although he acknowledged that much remains to be done. He also attributed the housing market situation to the central government and pointed out that, according to his data, 300,000 homes in Spain have exited the rental market, of which 9,000 correspond to the Canary Islands.
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