In Britain it’s called Value Added Tax (VAT), though where the ‘value added’ is remains a mystery. Elsewhere the self-same iniquity is levied across the European Union, enjoying different handles – here in Spain we call it IVA, while in France it is known as TVA and in Denmark, Finland and Sweden the acronym is the cuddly-sounding, but equally-detestable Moms.
First introduced in 1954 in France, it was based on a wunderbar wheeze for a universal consumer tax coined in 1918 by German industrialist Wilhelm Von Siemens.
Unlike far more equitable income tax, VAT/IVA/TVA or whatever nonsensical tag it poses under is basically pernicious, since it is applied without demur across all demographic groups and consequently hits the poor hardest.
This, though, is generally in keeping with EU custom and practice, since the Europrats of Brussels couldn’t think their way out of a paper bag and their one raison d’etre is keeping their juicy jobs at whatever cost to the people of member nations they allegedly serve or soak (take your pick).
Nations are free – to a limited extent – to fix their own levels of said tax. So, in an effort to dig itself out of the self-impose doo-doo caused by a rampant house-building and lending boom, a couple of months ago the Spanish Prime Minister, Mariano Rajoy, announced IVA would rise from 18 to 21% from September 1. To those without a calendar, that was six days ago – a salutary date, as I will endeavour to explain.
To the best of my knowledge and that of 43 million Spaniards, Senor Rajoy never uttered a syllable about the IVA rise being applied retrospectively.That fact, however, appears to have conveniently escaped the attention some of the country’s major service providers – notably Telefonica, Spain’s answer to BT and, in its guise as O2 and Movistar, the fifth largest mobile network operator in the world (revenue in 2011: €62,837 billion / profit: €6,187 billion / assets: €129,623 billion).
As I write, a blizzard of monthly bills is cascading through Spanish consumers’ letterboxes with IVA levied at the new rate of 21%, despite the fact that they cover calls and internet services for the month of August, when the tax was still calculated at 18%.
Perhaps this is a technical blip, an accountancy blunder. On the other hand, maybe this is just another example of mega-corporations ripping off customers, with the blind-eyed connivance of government.
Some explanation is required rapido and a good many hard-done-by working folk, who rely on phones, mobiles and internet connections for their dwindling jobs would like to hear it.
Over to you Senor Rajoy…