Why Should I Remain Catholic?
Solution 1:
First off, the malus to tech cost is likely caused by being the Defender of Faith as it gives +5% Technology cost. You can hover over the cost in the technology menu to see what impacts it.
As you're the New World leader, you also possess an advantage by staying Catholic with the Treaty of Tordesillas. If you stay friends with the Pope, you'll get a settler bonus in every colonial region where you were the first to establish a colonial nation, and every other Catholic will be penalized for colonising there.
I wouldn't actually dismiss the Pope at all. Even while the Papal States themselves aren't too powerful, controlling the Curia has a ton of bonuses:
- +1 Diplomats
- +1 Yearly prestige
- −10% Stability cost modifier
- +2 Possible advisors
- −20% Advisor cost
- +1 Leader without upkeep
- −20% Aggressive expansion impact
- −5% Technology cost
You can also get nice things from the Pope by spending Papal Influence independently of his power. Seriously, a powerful Papal States could prove a worthy ally for you as Spain if you don't have plans to expand further than you probably did by inheriting Naples.
Also, if you have the third Religious idea, you can declare holy wars on your heretic & heathen neighbours (regardless if you stay or flip), so keep that in mind for opportunities to strike.
Overall, I'd never flip early, if at all, as Spain, but rather see how the Reformation spreads out.