Catalonia's New Deal: A Step Towards Regional Autonomy

Grassroots members of Catalonia's separatist ERC party vote on a regional government deal with Spain's Socialists. The agreement could impact Spain's fiscal system and grant Catalonia tax autonomy. This comes after a failed independence drive in 2017 and aims to avert repeat elections in the region.

Grassroots members of Catalonia's separatist ERC party voted on Friday on a significant regional government deal with Spain's ruling Socialists, a move that could potentially mend strained relations between Madrid and the region while impacting Spain's entire fiscal framework.

Governed by separatists since 2010, Catalonia's peak independence movement in 2017 saw an illegal referendum and a short-lived declaration of independence. With waning nationalist influence, the centre-left Socialists emerged victorious in May's regional election without securing a working majority, making an agreement with ERC crucial.

The proposed agreement would support Salvador Illa, a Socialist, as the regional head, with an investiture vote potentially happening as soon as next week if approved by ERC members. Catalonia's new autonomy in tax collection under the preliminary deal may disrupt the current fiscal system where affluent regions aid poorer ones, subject to fragmented parliamentary approval. Prime Minister Pedro Sanchez calls this deal "a step towards federalization," though it faces criticism for its ambiguous solidarity clauses with other regions.

(With inputs from agencies.)