This is stated in a document that the Minister Telegram Number of Finance, María Jesús Montero, has offered to the councilors of the autonomous communities within the framework of the Fiscal and Financial Policy Council (CPFF).
In addition, the Treasury has committed to not taking unpaid VAT into account for the regional deficit. So if a region registers a deficit of 0.1% or less in 2019, it will be understood that it has met the deficit objective and will not suffer from Treasury control.
According to the document, the settlement of the 2017 VAT is a problem generated by Minister Cristóbal Montoro that PP and Ciudadanos prevented from solving, by rejecting the Government's proposal in the 2019 General State Budgets, and has not caused cuts in the spending of the autonomous communities.
For the Government, the autonomous communities have not made cuts due to the effect of the 2017 VAT settlement, but rather they have spent that money.
Therefore, what the effect of VAT has translated into is a greater public deficit in 2019 and a probable increase in the average payment period to suppliers.
According to the Treasury document, it is now not possible to review the 2017 settlement and therefore the proposal for palliative measures.
The Government has also stated that if a community, after deducting the effect of VAT, meets the deficit objective, it will not have to present an Economic Financial Plan (PEF).
And in addition to the FLA extra, if the communities take advantage of the financing mechanisms, they will be assigned to the Financial Facility Fund.
This implies being able to combine adhering to extraordinary liquidity mechanisms with going to the markets.