The VAT reduction on certain foods to lower the price of the shopping cart subtracted 254 million euros from the collection
June 11 () –
The Treasury entered an amount of 1,596 million in the first four months of this year for the new Special Tax on Non-Reusable Plastic Containers, the temporary energy tax and the temporary tax on credit institutions and credit financial establishments.
This is clear from the monthly report on tax collection corresponding to the month of April and recently published by the Tax Agency, which includes the impact of the measures approved by the Government in the recent year.
In total, non-financial resources –income- of the State up to April stood at 80,851 million, which implies 10.7% more than in the same period of 2022. Taxes reached 68,115 million, 84.2 % of total resources, growing by 7.8% compared to April 2022.
According to details of the Treasury, taxes on production and imports increased by 5.9% and, specifically, VAT revenues rose by 2.2%. In addition, within this heading, as tax novelties for 2023, the entry of the new Special Tax on Non-Reusable Plastic Containers, the temporary energy tax and the temporary tax on credit institutions and financial credit establishments stand out, with a joint amount of 1,596 million, of which 167 million correspond to packaging.
The new temporary tax on banks is levied at 4.8% on the interest and commissions of all entities that billed more than 800 million in 2019 and the tax will affect the activity that entities carry out in Spain.
For its part, the energy tax is levied at 1.2% on the amount of turnover of companies in the energy branch that billed more than 1,000 million in 2019. Income derived from activities is excluded from the billing subject to the tax. regulated.
In this way, the tax does not affect those revenues where the supply is at a regulated price, as is the case of the PVPC for electricity, the rate of last resort (TUR) for gas, bottled LPG and piped LPG.
In February, the advance payment of taxes was made, which corresponds to half of what was foreseen for the entire year. Thus, the financial and energy entities had to enter, as advance payment of said benefit, the result of multiplying the percentage of 50% over the calculated presentation amount.
In light of these first data, the Treasury expects that the initially estimated 3,000 million annually will be exceeded -in 2023 and 2024- on the collection of these temporary taxes. This ‘extra’ income will seek to cover the costs derived from the measures to deal with the economic and social consequences of the war in Ukraine.
It should be remembered that the final self-assessment of the new taxes (with the payment of the remaining 50%) will be presented from September 1 to 20 –with direct debit from September 1 to 15– in electronic format with forms 795 for the temporary energy tax and 797 for the temporary lien of credit institutions and financial credit establishments.
254 MILLION LESS DUE TO THE REDUCTION OF VAT ON FOOD
As regards the tax measures approved by the Government to lower the price of the shopping basket, the reduction of VAT on certain foods subtracted from the public coffers between January and April a total of 254 million euros.
The latest package of measures to deal with the economic consequences of the war in Ukraine and the increase in prices includes a reduction of VAT from 10% to 5% for oil and pasta and an elimination of VAT of 4% that applies to all staple foods.
Among the basic foods that see VAT eliminated, common bread stands out, as well as frozen common bread dough and frozen common bread intended exclusively for making common bread; bread-making flours; the following types of milk produced by any animal species: natural, certified, pasteurized, concentrated, skimmed, sterilized, UHT, evaporated and powdered; the cheeses; eggs and fruits, vegetables, legumes, tubers and cereals, which have the status of natural products in accordance with the Food Code.
These measures to lower the price of the shopping cart included in the decree approved at the end of 2022 –which entered into force on January 1, 2022– expire at the end of this month, although the Government maintains that it will maintain them “if situations persist of abnormality in inflation”.
IMPACT OF INCREASED REDUCTION IN WORK YIELD
The report also reflects the impact derived from the modification of the general reduction for work income approved by the Government and included in the General State Budget for 2023, which implies lower withholdings for the lowest incomes.
This meant an impact of 236 million euros for public coffers. According to the Treasury, the effect of this measure can be seen especially in pensions and in small companies, hence the greater impact that is incorporated this month.
RATE REDUCTION ON FEMININE HYGIENE PRODUCTS AND CONTRACEPTIVES
Also in terms of VAT in 2023, tampons, pads, panty liners have been taxed at a reduced tax rate of 4%, as they are essential products inherent to the female condition, as well as condoms and other non-medical contraceptives. Between January and April this tax reduction has put a loss of only 4 million euros for public coffers.
This year the maternity deduction for women with children under three years of age who carry out an activity on their own account or for someone else for which they are registered in the corresponding Social Security or mutual insurance scheme has also been extended this year. This measure has subtracted 17 million euros from the collection so far this year.
CHANGE IN THE FORM OF COMPENSATING LOSSES OF GROUP COMPANIES
Also noteworthy is the increase in income (232 million) that led to the change in the way of compensating losses of companies belonging to groups in the first payment on account of Corporate Tax.
With this measure, in fiscal year 2023, the tax base of the tax group is determined by adding the positive tax bases and 50% of the individual negative tax bases of the entities that are part of the group. Individual negative tax bases not included in the group’s tax base will gradually be integrated into it during the following ten years.
Also noteworthy are the higher revenues (25 million) that occurred in April as a result of the changes in the Fluorinated Gas Tax, among other issues, in the deadlines for submitting returns (before, the revenue from the first return of the year was given in May and now it is in April).
