It will apply a tax on wealth of more than 3 million euros, while extending the deduction for income from employment from 18,000 to 21,000 euros. The Executive calculates additional revenue of 3,144 million euros to the public treasury
The fiscal battle started by the Autonomous Communities in recent weeks has forced the government to adopt new measures to be adopted through the General State Budget (PGE) and the parliamentary initiative. The Minister of Finance, María Jesús Montero, presented a new package of measures that will affect personal, corporate and wealth tax.
“The current situation calls for decisive action to help families and businesses,” the minister said while addressing the media. In line with this idea, he announced the introduction of a new solidarity tax on large fortunes, which will be applied temporarily in 2023 and 2024 to taxpayers with a net worth of more than 3 million euros (plus 300,000 euros of habitual residence).
The levy will establish three tranches at the state level. A rate of 1.7% will be applied for assets between 3 and 5 million euros. For those between 5 and 7 million euros 2.1%, while if they are more than 10 million euros, they are taxed at 3.5%.
The minister has indicated that double taxation is prevented, so that the compensation for Heritage in the Autonomous Communities is fully deductible. According to the Executive, the potential collection of this measure is 1,500 million and the potential taxpayers 23,000 million.
The tax on capital income of more than 200,000 euros will also be increased from 26% to 27%. For those over 300,000 euros, it also rises two points to 28%.
In return for this increased effort for those who earn the most from personal income taxes, the government will propose an increase in the cut in labor income. In other words, the brackets and rates are not touched, but the tax benefit that certain lower income earners already enjoy is extended. Currently, this tax benefit applies to 18,000 euros and now the discount is extended to 21,000 euros.
“It is not a randomly chosen figure, because the average salary in Spain is around that figure,” explains the minister. According to calculations by the ministry, the measure will save the beneficiaries of 1,881 million euros. “An employee who earns 18,000 euros, saves 746 euros per year with the measure,” the minister explains. The minister assures that the transfer of personal income tax proposed by the ccaa only yields 23 euros.
The minister clarified that the measure cannot be compared with the deflation proposed by some Autonomous Communities. “It’s not deflation, because that’s a general tax cut, and it should be avoided. What we are applying is an extension of a deduction that already existed on income from employment’, he says.
The reduction will also reach the tax minimum. Salaries from 15,000 euros are now exempt from paying personal income tax, compared to the current 14,000 euros. “It is a measure that tries to accompany the rise of the SMI,” said the minister. This measure will be included in the next PGE.
For the self-employed, a reduction of 5 pp will be applied to the net performance of the modules and the billing limits will be extended in 2023.
With regard to corporate tax, the government will include a reduction of the nominal rate from 25% to 23% of the corporate tax rate for small companies with a turnover of less than one million euros from the minimum tax rate of 15% for large companies. The government estimates that 407,000 companies will benefit from the measure.
To this will be added a regulatory change that will limit the ability to offset losses of subsidiaries in consolidated groups by 50%. In other words, only 50% of the losses can be offset and the rest from 2024.
“What makes this measure possible is a higher return on corporate income taxes,” the minister said, recalling that the average of the consolidated groups bills around 200,000 million euros. 2,439 million euros between 2023 and 2024, affecting some 3,600 companies, 0.2% of those filing corporate taxes.
The net balance of all these initiatives will generate additional income of EUR 3,144 million. We have to make the fiscal adjustment to fight inflation,” they indicate from the ministry, where they calculate that the reduction in energy tax has resulted in savings of more than 10,000 million euros for families and companies. “The measures respond to the needs of the moment and are justified,” said Montero.
“Since the start of the legislature, the government has been working on a tax system that guarantees social justice and economic efficiency,” he said during his speech. “When we talk about taxes, we’re talking about how we can fund pensions for the elderly, scholarships for the young or how we guarantee resources for dependency and maintain public and universal health care for all citizens, regardless of the money they have in their bank accounts.” .
Source: La Verdad
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