This article is more than 8 years old

This article is more than 8 years old

The Spanish prime minister, Mariano Rajoy, roundly rejected attempts by the Catalan government to win greater tax-raising powers on Thursday‚ potentially pushing the wealthy north-eastern region towards demanding independence.

Afterwards the Catalan regional leader, Artur Mas, said: "A historic opportunity has been lost." Mas was expected to return to Catalonia and decide within weeks on a date for fresh regional elections which are likely to see his nationalist Convergence and Union coalition run on a more openly separatist programme, as polls show support for independence climbing above 50%.

A separatist majority in the Catalan parliament would provoke a constitutional crisis as Spain tries to cope with double-dip recession, 25% unemployment and, potentially, a bailout by fellow eurozone countries.

Mas wanted a change in the tax system as a step towards increasing tax flows into Catalonia. It would have seen the Catalan government collecting taxes and sending a share to central government, rather than the other way around.

"The prime minister opposed the proposal … because it is incompatible with the Spanish constitution," Mr Rajoy's office said in a statement. Mas disagreed. "You cannot hold the constitution up as a wall," he said, claiming it had been written in the shadow of General Francisco Franco's dictatorship and at a time of fear of military coups.

Spain's 1978 constitution does not provide for the independence of Catalonia or any other region.

Polls show Catalans are furious that they contribute 8% more in tax revenues than their region receives back from central government. Support for independence has surged over the past year as Mas's regional government cuts health and education services in response to central government demands to cut its budget deficit.

A decision by the country's constitutional court to strike out parts of a new autonomy charter for the region in 2010 had also angered many Catalans, and signalled a limit to devolution without constitutional reform.

Hundreds of thousands of demonstrators took to the streets of Barcelona on September 11 to demand independence, the biggest-ever show of support for a separate Catalan state.

Catalonia has one of the highest deficits amongst Spain's 17 autonomous regional governments, but locals largely blame spending cuts on Rajoy's government.

Mas insisted on Thursday that he wanted Catalonia to remain inside the European Union and the euro – but he added that the Spanish constitution could not be used as a block to any widely supported Catalan aspirations for greater sovereignty.