The wealth tax (IP) is dead. This statement is based on an in-depth study of the subject that leads to a conclusion with a simple explanation.
The popular parliamentary group, in March 2021 appealed to the Constitutional Court the first repealing provision of the budget law for the year 2021, understanding that, by making the temporary restoration of the IP indefinite, article 134.7 of the Constitution was violated , according to which a budget law cannot create taxes, which is in fact what the aforementioned law was doing with the IP.
Statement that we share and that should imply its unconstitutionality.
But, in addition, there is an aspect to highlight that ratifies the unconstitutionality of this tax, in all the budget laws that have restored it, even temporarily, since the first of 2014. This essential aspect is the second final provision of Law 19/1991, of June 6, regulating said tax, which establishes that the General State Budget Law may modify, in accordance with the provisions of section 7 of article 134 of the Spanish Constitution, the exemptions, the reductions in the taxable base, the determining limit of the obligation to declare, the sections of the taxable base, the types of the rate and other quantitative parameters of the wealth tax.
In other words, it specifies what IP modifications can be made by budget law, in accordance with the Constitution. And the question is: does article 36 (Self-assessment) of the IP law, which determines the duty to file a statement and make a self-assessment, fits into the possible modifications?
The overwhelming answer is no, since it is not a question of any quantitative parameter, it is giving life or death to the tax, if there is no declaration and payment, it simply does not exist.
The second question is: since the tax was abolished by Law 4/2008, of December 23, in which the aforementioned article 36 was repealed, among others, any regulation, be it royal decree-law or the budget laws themselves that have been extending taxation since 2011, can they be considered “substantive tax law” according to the jurisprudence of the Constitutional Court itself? The resounding answer is that not with respect to the Budget laws, and without being so resounding that no, also with respect to the decrees. And the Constitutional jurisprudence is clear: modification is allowed, even substantial modification, but provided there is a provision in this regard in the substantive tax law (TC website).
Conclusion: since the IP tax was abolished in 2008, as expressed in the explanatory statement of law 4/2008, repealing, among others, article 36, it could not be restored by any budget law, not even on a temporary basis, and certainly not with royal decree-laws either, which means that the tax is clearly unconstitutional and therefore dead.
