Data, figures, numbers and statistics have the ability to be interpreted, but they do not lie. The 271,935 million euros that the Treasury collected in taxes last year, 6.4% and 16,500 million more than what was collected in 2022, is only the tip of the tax iceberg that Spanish households have accumulated since 2018, when President Pedro Sánchez took office, and that has fattened the public machinery with an extra 63.25 billion in taxes in just six years.
That first year, the State coffers received 208,685 million from the citizens' pockets. Since then, the growth of tax contribution has grown exponentially, the result of the geometric increase in tax pressure. Except for the impasse that occurred in fiscal year 2020, that of the pandemic, each fiscal year surpassed the previous tax collection at a record pace. Already in 2019, the first full year of Sánchez's term, income grew by more than 4,000 million, the most modest increase in these six years, although it already reached a record level: 212,808 million. From there, the numbers speak for themselves. 2021 closed with a collection of 223,385 million and an advance of 26,300 million more in taxes, largely the result of the recovery after the return to normality. But the following year, the Treasury achieved a much higher figure, 255,463 million, which would be an extra 33,000 million in 2022, the highest historical jump in collection in a year.
Last Thursday, the 2023 annual collection report reflected the new collection record, those 271,935 million, with income from personal income tax that amounted to 120,280 million, 9.9% and 16,500 million more than what was collected in 2022. The Treasury justified in its report that this tax bonanza has been produced by “the increase in employment, salary increases and pensions, the increase in the effective rate, the growth in withholdings for capital income and fractional payments.” of personal companies. In no case did he mention the increase in the tax wedge, which has multiplied in the last five years.
Not in vain, this same week the General Council of Economists of Spain confirmed that 35 of every 100 euros that a worker earns end up in the treasury coffers for the payment of taxes and social contributions. In his study “Tax bill of Spanish households” he determined that the middle class has been the most affected by this increase in tax pressure. Other organizations raise that tax wedge much higher. For the OECD, the Spaniards have suffered the largest tax increase and the oldest collapse of real disposable income of its citizens among the large economies of the world, a circumstance that has occurred since 2019, since the first full year in which Sánchez assumed the reins of the Government. Thus, Spain has placed itself in first place among the Member States in which taxes on Income and Wealth increased the most in the last five years – between the last quarter of 2019 and the third quarter of 2023 –, which the « think tank” has estimated a growth of 50%.
The figures are scary in the case of Spain. The tax burden accumulated during the last five years – in the Income and Wealth tax – has increased by 15.8 billion. That is, in the fourth quarter of 2019 it was 26,678 million euros and rose to 42,480 million in the third quarter of 2023 – the latest data available.
The prestigious Juan de Mariana Institute maintains this same line and has confirmed that the weight of taxes on the national GDP has skyrocketed six points, from 32% to 38% since 1995. It is not attributable to Sánchez or his Minister of Finance, María Jesús Montero, all this tax push, but she must assume the majority of it, since 60% of the increase in fiscal pressure has taken place under his Government. According to their accounts, tax revenues have skyrocketed by 72,962 million euros, an increase of 2.8%, corresponding to 3,890 euros per household and 1,527 euros per person, especially for personal income tax. That is to say, the middle class already pays more than 50% of its salary to the Treasury after the 69 tax increases recorded by this body.
The Institute of Economic Studies (IEE) reached similar conclusions in its “Report on tax competitiveness” which places Spain in the caboose of the fiscal competitiveness index. The IEE considers that the increase in tax collection should be based on an increase in tax bases and the fight against tax fraud, and not on tax increases that reach collection records and tax pressure above the EU average. They also criticized that the companies suffer a higher proportion of corporate collections, above the European average more than 11 points.
The tax pressure has reached record levels in the four main tax figures concerned: personal income tax, VAT, corporate tax and special taxes (IE). Thus, between 2019 and 2022, it has exceeded the maximum levels reached in 2007, just before the financial crisis, when the fiscal pressure reached 18% of GDP with these four taxes. Now, It is already at 18.2%. This is determined by Funcas in its latest study, which has confirmed that based on data, average rates and collection from the Tax Agency of these four figures, the tax pressure has increased progressively since the minimum of 2009 – located at 12, 8% of GDP–, spurred by the bursting of the real estate bubble and which grew moderately until the acceleration suffered after the pandemic until exceeding the maximum of 2007.
The increase in tax pressure has been essentially due to personal income tax, whose pThis tax has increased two points of GDP until 2023, due to both the increase in the tax base and average rates. In the case of VAT, it increased 1.2 points, driven by higher bases.
For Fedea, the tax pressure has increased by 2.9 points of GDP after the pandemic, going from 35.4% to 38.3%, practically six times more than in the eurozonewhere it increased only five tenths in that period (41.9%), and 15 more than in the EU, which only rose two tenths, up to 41.2%.