Income tax collection in the first two months has registered the best start of the last 15 years in Spain. Net income grew throughout January and February by 11.8% compared to 9.4% last year. It is logical that in a normalized situation each financial year registers a growth in revenue, but this year’s increase is the largest in the historical series.
The Tax Agency gives some clues as to why. In February, “in the private sector we can already see a new rise in wages, significantly higher than in 2022”. The monthly report of the AEAT states that “the information from the Large Companies at constant population indicates that the salary increase in the first month of the year would have been 5.3% compared to 3.7% with it was closed in 2022â€. This effect plus the maintenance of the rate of job creation explain the most important increase observed in retentions, adds the agency. Sources from the Tax Agency state that two months is a very short period to glimpse clear trends for the year as a whole.
Carlos MartÃn, director of the economic studies office of CC.OO., indicates that the salary increase statistics do not discriminate whether it is because of the increase in salaries or because the new hires earn more. According to his opinion, the increase in revenue is due to the creation of jobs, the type of jobs that are believed to have higher salaries and due to increases in wages. “Despite the loss of purchasing power, wages have increased”, he recalls. Only last year, the increases agreed in the agreement exceeded 3%.
In 2022 there was a record growth in collection especially in personal income tax, which increased by 15.8%. The director of Fedea, Ãngel de la Fuente, points out that it is possible that in the increase in collection there is “a little surfacing of submerged activity” and added that “inflation certainly helps”. According to his opinion, “employment is increasing and more so is declared employment”, but even so he notes that there is some unknown element that causes the collection to grow to such high levels.
At the regional level, in the main taxes collected in Catalonia, for example, there is an increase in collection on inheritances and a fall in Itpajd, which is the tax linked to real estate purchases. In patrimony, the statistic is not significant for the first two months of the year, since the collection usually occurs in the middle of the year. Sources from the Department of Economy headed by Natà lia Mas point out that “it seems logical that the drop in the Itpajd is motivated by the rise in interest rates”, which would have reduced real estate sales operations. Last year, Economia assured that the strong growth in the collection of that same tax is because decisions to purchase properties were brought forward due to the rate increase”. Regarding Successions, ministry sources say that “the variations are random and it is difficult to isolate a factor that conditions the increases or decreases”.
The collection of personal income tax in Spain as a whole via payroll deductions is based on state taxation rates, therefore, it does not take into account the deflation that half of the autonomous communities carried out last year. Treasury sources explained that, in any case, the impact on additional collection is small.
From Funcas, researcher Desiderio Romero believes that, despite the fact that there is some uncertainty, it is possible that “the collection will have an increasing trend, but not as much as in 2022”. On the possibility that the underground economy explains part of the improvement in collection in recent months, Romero believes that the estimates on unregulated activity must be taken with “a lot of caution” because they are very uncertain data.
