Pedro Sánchez in Palma on Monday. | Pere Bota


Ahead of Tuesday's general policy debate in parliament, President Armengol received good news from Prime Minister Sánchez on Monday. The Spanish government's 2023 budget will include tax benefits under the special economic regime for the Balearics (REB) and a twenty million euros investment in the Palma tram system.

The REB, a Balearic demand for years, had been partially catered for in the 2022 budget. This was 183 million euros as compensation for costs of insularity. However, Congress blocked the other part - tax benefits. These have now been approved and will amount in total to 349 million euros.

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According to the Balearic government, 208 million euros will be in the form of direct tax incentives for 47,000 businesses and 71,000 self-employed. The government estimates that, along with other measures, some 3,200 new jobs will be created each year.

The twenty million for the tram is in fact the result of European funds negotiations between Madrid and Brussels. The prime minister said in Palma on Monday that "after much discussion with President Armengol, the president of the Council of Mallorca and the mayor of Palma, the state has agreed to finance the tram with 20 million euros". "This has been one of the great demands of the capital and the island."