The tax reductions in communities governed, in their vast majority, by the Popular Party will have a negative effect on the collection of 2,040.3 million in 2024. This is the conclusion of the Ministry of Finance after analyzing all the announcements made in the election year by the different autonomous governments in relation to transferred tax figures. The acting Executive reflected in the Budget Plan sent to Brussels a few days ago this decrease in income, a decrease that it classifies as “negative effects” regarding the configuration of public accounts.

In the section on “discretionary measures adopted by the autonomous communities”, the document sent to the European Commission explains that the tax decisions already in force will have a negative effect of 513.8 million on the collection in 2023, excluding those in relation to the crisis caused by the war in Ukraine. That is, the reductions will quadruple in 2024 the decrease in this year’s income.

The main reduction in collection next year will occur in the Income Tax, specifies the Ministry of Finance. Specifically, the reductions in the regional section of personal income tax will mean a global reduction in income of 1,728.6 million in 2024. The loss of collection estimated in this figure is 613.4 million for the current year. The reductions in personal income tax are applied by communities governed by the PP and also by Castilla-La Mancha, led by the PSOE.

The bonuses and deductions applied to the Inheritance and Gift Tax will also have a greater negative effect on next year’s collection. The Treasury estimates that in 2024 a total of 297.4 million more will stop entering due to the decisions that some regional governments have been making to subsidize this figure.

Finally, the total or partial reductions in the Wealth Tax, subsidized in some autonomies governed by the PP, will mean an additional negative effect of 24.1 million next year on income. This loss of Heritage collection is compensated (in part, since the collection is state) by the entry into force of the Solidarity Tax on Large Fortunes, which next week will have to pass an important litmus test in the Constitutional Court. Specifically, the new tax will generate revenue in 2024, according to Treasury calculations, of 640 million in 2024, compared to 619 million this year.

The ministry estimated a “collection potential” for the Large Fortunes Tax of 1.5 billion. However, the first liquidation reduced that figure by 60%. This was due to the fact that a significant number of Madrid, Andalusian and Galician taxpayers included as a limit to pay the full amount of the Wealth Tax without a bonus. The bar was raised and revenues fell.

The decrease in regional income of just over 2,000 million due to reductions in these tax figures next year is partially offset by the implementation of the new tax on the deposit of waste in landfills, incineration and co-incineration of waste. In 2023 this figure will provide income of 241.7 million.

It must be remembered that the Government contemplated in the Budget Plan a flexibility in the deficit of the autonomies, with a rate of 0.1%