Spanish court backpedals on mortgage tax
Spain's Supreme Court has ruled that the stamp tax due on mortgages must be paid by the client and not the bank, overturning its decision of just two and a half weeks ago in the clients' favour, which had caused bank shares to plunge. According to Spain's press, the court ruling has inflicted major damage.
Those with the money wield the power
The reversal of the ruling in the banks' favour will fuel people's mistrust, warns El Periódico de Catalunya:
“Everything that was white two weeks ago is now black. ... It is hard to understand why the Supreme Court is being so considerate with the banks yet is so inconsiderate in other matters of a political or social nature. The decision fits the big picture: the role of the financial sector in the economic crisis, taxpayers having to foot the bill for the bank bailout, astronomical executive salaries, scandals like the 'black' credit card case involving politicians. This latest episode will only increase public distrust of the financial sector, which they see as a dark power that controls politicians and now judges too.”
Major damage to court's image
The ruling will have a positive impact on the country's stability but has tarnished the reputation of the judiciary, El Mundo notes:
“There's no denying that the Supreme Court has cut a very poor figure here. ... The banks' share prices will recover, there won't be an avalanche of lawsuits blocking the courts, and regional governments won't have their finances thrown off balance. The tax office won't have to fight with the banks and the banks won't have to pass on the losses to their clients. ... But the damage the judiciary has done to its own reputation is a mortgage which all of us will have to pay.”