Wealth taxation in Spain and the political cycle at the regional level

Abstract

In Spain, wealth taxes (except property tax) are transferred to the Autonomous Communities, which have the regulatory capacity to modify the basic determinants of the taxpayer’s tax debt (exempt minimums, tax rates or tax credits). While in some Communities, the tax credits approved, in the last decade, have meant, in practice, the «suppression» of some of these taxes (eg, the Personal Wealth Tax or the Inheritance and Gift Tax) or a tax reduction (Tax on Capital Transfers and Documented Legal Acts), in other Communities, there has been a «recovery» or increase of them. Both cases have been closely linked to the political cycle. In other words, there has been an electoralist use of wealth taxes.
In this work, a comparison is made of the wealth taxes regulations in each Autonomous Community with the aim of analysing their evolution during the pre-electoral and post-electoral periods, taking into account the political configuration of each Autonomous Parliament. It also analyses the impact of these changes on taxpayers’ tax debt, according to their tax domicile and the political cycle.