Salvador Illa of the Socialist Party of Catalonia was sworn in on Aug. 10 as the region’s president, heading the first regional government led by a leftist, anti-independence party in 14 years.* During the investiture debate that took place two days before, Carles Puigdemont—the leader in exile of one of Catalonia’s separatist parties—made a dramatic appearance in Barcelona in an attempt to draw attention to himself and breathe new life into the independence movement. Nevertheless, the investiture vote took place without incident, marking a turning point for Catalan politics and leaving separatism on life support.
Illa, the calm and bespectacled former Spanish health minister, won with the minimum of 68 votes required to form a minority government, including 42 from his own party, as well as 20 from the leftist pro-independence Esquerra Republicana, or ERC, and six more from the left-wing Comuns Sumar.
It’s a win for Spanish Prime Minister Pedro Sanchez and his preference for dialogue and negotiation with Catalan leaders, even if he made two big sacrifices to get there. Last November, he negotiated an unpopular amnesty deal for crimes committed by activists and politicians in connection with the two independence referendums held in Catalonia in 2014 and 2017. In exchange, Sanchez gained the support he needed from the two separatist Catalan parties, ERC and Puigdemont’s Together for Catalonia, or Junts, to win reelection and form a new central government in Madrid.
Now, to form a regional government led by the PSC, which won the most votes in May’s regional election, Sanchez agreed to a tax deal that the Catalans have long coveted. Catalonia is one of Spain’s wealthiest regions, and among its longstanding complaints is that it pays more in taxes to the central government than it receives in government services. As in many countries, Spain’s central government redistributes tax revenue from wealthier regions like Catalonia and Madrid to poorer ones, like Extremadura and Andalucia. The new deal will allow Catalonia to collect and administer its taxes itself, while only paying the central government for the services it receives.
Sanchez has acknowledged that the deal represents “a step towards federalization” of Spain’s already quasi-federal system. However, it will also exacerbate wealth disparities among the country’s regions and has already gotten pushback from regions governed by the opposition Popular Party, or PP, as well as from some Socialist leaders who find it unfair. Most notably, Emiliano Garcia-Page, the Socialist regional president of Castilla La Mancha, called it a “serious attack on equality.”
Currently, taxes are administered centrally in Spain, with the exceptions of the Basque country and the Navarre region, which retained their historical rights of self-administered taxation in the constitution drafted during the transition to democracy in 1975. According to a poll run by SigmaDos, 63 percent of Spaniards believe that the Catalan tax deal will harm the rest of the country’s regions. The percentage rises to over 90 percent among supporters of the PP and the far-right Vox party, which oppose any further federalization of Spain’s governing system and accuse Sanchez of trying to break the country up every time he engages in dialogue and negotiations with the Catalans.
Dialogue and negotiations with the Catalans have indeed lowered tensions in Catalonia. However, Sanchez is now saddled with two deals that are deeply unpopular with the Spanish people as well as his own party.
Meanwhile, despite his self-imposed exile, Puigdemont remains a fly in the ointment. As the leader of the center-right separatist Junts party, Puigdemont took part in the negotiations leading up to last November’s amnesty deal from Belgium, where he is located. A guarantee for his own return to Spain was at the center of the deal, helping to secure Junts’ support for Sanchez’s reelection at the time. This was met with mass protests and some violence around the country, and Puigdemont’s impending return with impunity was expected to fuel even more disorder. But in early July, Spain’s Supreme Court rejected parts of the deal, arguing that the amnesty doesn’t apply to some of Puigdemont’s alleged crimes, leaving his long-standing arrest warrant intact.
This, however, didn’t keep Puigdemont from staging a Houdini-like political stunt on Aug. 8, the day of the investiture debate in the Catalan parliament. Taking advantage of a crowd wearing matching straw hats and using various cars, his team managed to sneak Puigdemont through a police blockade to give a brief speech in front of a few thousand supporters at the Arc de Triomf. “We have been persecuted for seven years for wanting to hear the voice of the people of Catalonia,” Puigdemont declared, before subsequently being spirited away and back out of the country.
The outraged opposition leveled accusations of police incompetence and even complicity over the failure to arrest him, but there’s no doubt that for all involved, an exiled Puigdemont is preferable to a jailed and therefore martyred one.
Anyone who has followed Sanchez’s tenure as prime minister knows not to count him out, even when he’s built what appears to be a house of cards. Dialogue and negotiations with the Catalans have indeed lowered tensions in the region to the point that 53 percent of Catalans now oppose independence, while just 40 percent remain in favor of it, according to a poll released in July by the Center for Opinion Studies. This is the biggest gap between supporters and detractors since 2015.
However, Sanchez is now saddled with two deals that are deeply unpopular with the Spanish people as well as his own party. As of March, 62 percent of Spaniards opposed the amnesty deal, including 42 percent of Socialist Party voters, among whom just 40 percent supported it. Similarly, 63 percent oppose the tax deal for Catalonia.
More importantly, Sanchez needs Junts’ votes in Madrid to pass a 2025 budget bill, on which he has delayed further legislative action in hopes that tensions will calm down. The Socialists are also betting that Junts will have to rethink Puigdemont’s role within the party. Indeed, Junts has moved up its party convention from 2026 to late October of this year to reorient its strategy, given the new political landscape.
In the meantime, the Catalan people may have finally elected a government that will spend its time on policymaking to solve challenges such as housing and infrastructure, rather than a nearly exclusive focus on independence. After his election, Illa promised, “I will govern for everyone, keeping in mind the plurality of Catalonia, I will be at the service of all of you, trying to make things as good as possible.”
*Editor’s note: The original version of this article referred to the new regional government as a coalition government. It is technically a minority government.
Alana Moceri is an international relations analyst, writer and professor at the IE School of Global and Public Affairs. Follow her on Twitter @alanamoceri.