On 28 December 2002, Law 38/2022 of 27 December 2002 was published in the Official State Gazette (BOE). Article 3 of this law regulates the new Temporary Solidarity Tax on the Great Fortunes (ITSGF). These are its main lines.
Who should pay the wealth tax?
This temporary tax is a direct tax, which supplements the Wealth Tax of individuals whose net wealth exceeds 3 million euros with an additional amount. Double taxation is avoided because taxpayers may deduct in the ITSGF the amount actually paid in Wealth Tax.
Objectives of the wealth tax
Its main objectives are twofold:
- Revenue-raising purpose. In the current context of the energy crisis and rising prices, this instrument requires a greater effort from taxpayers with greater economic capacity.
- Harmonising purpose. This is a state tax, which cannot be ceded to the autonomous communities. Because one of its objectives is to reduce the differences that exist in the taxation of wealth in the different autonomous regions.
In which years the solidarity tax will have to be paid
The Temporary Solidarity Tax on the Great Fortunes will in principle be applied in the first two financial years after its entry into force. That is, the years 2022 and 2023, since it came into force the day after its publication in the Official State Gazette, 29 December 2022.
However, although the new tax is temporary for the time being, the regulation also specifies that it can be reviewed. Thus, at the end of its foreseen duration, the results may be evaluated and its continuation or abolition may be proposed.
How the tax base will be calculated
The tax base corresponds to the value of the taxable person’s net assets. This is determined by the difference between the value of the assets and rights held by the taxpayer:
- Charges and encumbrances of a real nature, when they diminish the value of the respective assets or rights.
- Personal debts or obligations for which the taxable person is liable.
- The taxable base will be reduced, as an exempt minimum, by EUR 700,000.
For the rest, the rules of Chapter IV of the Wealth Tax Law apply. Thus, for example, the following are exempt from tax: assets belonging to the Spanish Historical Heritage or to the Autonomous Communities, objects of art and antiques that do not exceed certain amounts, the habitual residence up to a maximum amount of 300,000 euros, economic rights corresponding to certain social welfare systems, assets and rights necessary for the development of the taxpayer’s business or professional activity, etc.
What is the applicable scale of fees?
- Assets between 3,000,000 and 5,347,998.03 euros are taxed at a rate of 1.7%.
- Those between 5,347,998.03 and 10,695,996.06 euros are taxed at a rate of 2.1%.
- Those exceeding 10,695,996.06 euros are taxed at a rate of 3.5%.
The full amount of the ITSGF, together with the amount of personal income tax and wealth tax, may not exceed 60% of the sum of the taxable bases of the former. Once again, the rules on the limit of the full amount of wealth tax apply here.
If the sum of the contributions of the three taxes exceeds 60%, the amount of this tax shall be reduced up to the limit indicated, without the reduction exceeding 80%.