Personal income tax deflation is a fiscal measure to compensate for the effect of rising prices (inflation). In concrete terms, it means an increase in income tax brackets, so that taxpayers who see their salaries rise do not have to pay proportionately more income tax.
The institutions of the Basque Autonomous Community have agreed to deflate the IRPF (Personal Income Tax or Income Tax Return) by 2.5% by 2024. The deflation of 2.5% is added to the adjustments with a percentage of 7.5% that was applied to this tax in recent years. two years. In addition, the taxpayer will continue to apply the deduction of 200 euros for incomes of less than 30,000 euros in the tax return for 2023 next year.
After the institutional agreement (Basque government, the three provincial councils and Eudel), the deflation must be approved in each of the three general assemblies of Araba, Bizkaia and Gipuzkoa.
What is deflation? How does this affect taxpayers?
Deflation is a tax measure to prevent taxpayers from having to pay more taxes due to inflation.
In concrete terms it is one increase in personal tax rates (no reduction in personal income tax) in line with inflation, so that taxpayers who see their salaries rise do not pay proportionately more income tax.
The income tax brackets are adjusted, resulting in a lower amount to be paid. (Normally, the provincial treasuries publish the withholding tables before the end of the year).
So deflation means that all people and families have access to it more money in your pocket.
Source: EITB
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