Spain¡¯s new PM faces first crisis as minister quits over tax scandal

Spain¡¯s new prime minister, Pedro S¨¢nchez of the Socialist Party (PSOE), has faced his first government crisis just six days after appointing his Cabinet team.

His brand new culture and sports minister, M¨¤xim Huerta, resigned on Wednesday evening after the media reported that he withheld taxes in the early 2000s and was recently forced to pay €365,000 in back taxes, late fees and fines.

A journalist, writer and TV commentator, Huerta used a company to deduct expenses on earnings from his ¡°artistic work¡±

A journalist, writer and TV commentator, Huerta used a company to deduct expenses on earnings from his ¡°artistic work.¡± These deductions included the purchase and upkeep of an apartment on the Mediterranean coast, El Confidencial reported.

The outgoing minister blamed the media revelation on an attack by what he termed as la jaur¨ªa (a pack of hounds) against S¨¢nchez¡¯s new government project. The new Socialist PM led a successful no-confidence motion against then-Prime Minister Mariano Rajoy of the Popular Party (PP) two weeks ago, the first time in modern Spanish democracy that a head of government was ousted in this way. After taking down a leader who had been plagued by graft scandals, S¨¢nchez pledged to be tough on corruption.

The Huerta crisis was resolved in less than 11 hours, when S¨¢nchez decided to let his new minister go. One hour later, his replacement was announced: Jos¨¦ Guirao, who was director of the Reina Sof¨ªa Museum in Madrid between 1994 and 2001. He was also head of La Casa Encendida art and culture center from 2002 to 2014.

There was no official statement on the subject of Huerta¡¯s departure, either by S¨¢nchez or by any government spokesperson. Huerta ¨C who has been the shortest-lived minister in modern Spanish history ¨C suggested that the whole thing was a way of attacking the new S¨¢nchez administration.

There was no official statement on the subject of Huerta¡¯s departure, either by S¨¢nchez or by any government spokesperson

¡°I am leaving so that the jaur¨ªa will not break up Pedro S¨¢nchez¡¯s regeneration project,¡± Huerta stated at 7pm on Wednesday, after declaring himself ¡°innocent¡± on the basis that he had already paid his dues with the Spanish Tax Agency following a ruling against him by the Madrid Regional High Court in 2017.

Huerta was alluding to the cascade of stories, comments and widespread condemnation in the news and in social media, following revelations that he withheld €256,778 in taxes between 2006 and 2008.

Huerta used the word jaur¨ªa up to three times, and lamented that ¡°innocence means nothing,¡± insisting that he had not committed fraud. He was not convicted of the crime of tax fraud because the amount withheld did not reach the €120,000 threshold on any individual tax year. Instead, he was ordered to pay his back taxes, plus late fees and a fine.

The story was originally published by the digital daily El Confidencial, and opposition parties immediately demanded Huerta¡¯s resignation. The PP and Podemos reminded S¨¢nchez of one of his own statements made in 2015, when he declared that ¡°any politician who creates a company in order to pay half his taxes would be ejected from any government of mine the following day.¡± That statement was made in connection with another tax fraud scandal involving Juan Carlos Monedero, co-founder of Podemos.

Although Huerta described his resignation as a personal decision, earlier that day he had seemed disinclined to take that step. In statements to the Onda Cero and Cadena SER radio networks, he insisted that he had nothing to be sorry about.

Any politician who creates a company in order to pay half his taxes would be ejected from any government of mine the following day

Prime Minister Pedro S¨¢nchez, speaking in 2015

Huerta claimed that his trouble with the Spanish taxman stemmed from ¡°a change in the agency¡¯s criteria,¡± which did not accept the use of a company to pay personal income tax in the way that he had done during the years in question. ¡°This matter did not take place while I was a minister, it was as M¨¤xim Huerta, and after the change of criteria by the tax agency I paid everything, so case closed,¡± he told the media on Wednesday.

¡°A lot of people in his line of work did that sort of thing, but it¡¯s wrong, and none of the others are ministers,¡± said a high-placed PSOE official.

English version by Susana Urra.