The day of fiscal freedom in Spain is spent in 10 years from May 4th to July 13th

And next year will be July 29, according to the new calculations of the Civic Foundation, taking into account the General State Budget (PGE) for 2023.

In a recent study by think tank Real Elcano, we learned that one of the main concerns of the Spaniards, compared to the French, was the constant increase in the tax burden in Spain. And the facts unfortunately prove them right. In 2023 Spaniards and residents of Spain will work until 29 July pay taxes, according to the latest calculations of the Civic Foundation. This is 16 days more than this yearif all the taxes announced in the 2023 State Budget come into effect.

One of the main concerns of the Spaniards, compared to the French, is the constant increase in the tax burden in Spain

The Civic Foundation presents an indicator every year that shows the share of taxes paid in relation to income. The calculation is done by counting the number of days you have to work per year to pay all taxes, VAT, duties and social security contributions.

+ 12% tax burden in 2022

Thus, in 2022, thea tax burden on families who pay taxes in Spain (in terms of personal income tax, VAT and miscellaneous taxes) increased by 12%, while family income increased by 4% nationwide.

Evolution of the tax burden in Spain 1999-2021 – Source: Civic Foundation

Tax increase of 10 points in 20 years

Although the upward trend in the tax burden has increased over the past two years, it has not not an exclusively current phenomenon. Over the past two decades (since the fourth quarter of 1999), taxes paid by households have increased 3.79% on average per year, while, in the same period, the sum of labor income and capital income increased by an average of 2.84% per year.

Table of the share of taxes on net salary 20,000 euros according to CCAA spain
net salary of 20,000 euros according to CCAA Spain / Fundacion Civismo

In other words, over the past 22 years, taxes have risen more than incomes. This is how the average Spanish family pays 10 tax points more today than in 1999. Specifically, since the mid-2000s, the the trend is towards an increase in household taxation, measured as a percentage of total household income. From the low reached in 2009 following the crisis, the real tax burden on household income has increased by 6 percentage points in three years, and then decreased thanks to the economic recovery and the 2015 tax reform which reduced direct taxation on labor and on capital.

share of taxes net salary 45,000 euros according to CCAA spain
Net salary on 45,000 euros of a single person according to the regions Spain / Source: Fundacion Civismo

Tax Freedom Day: 33 more days from 2018

Since 2018, and the arrival of Pedro Sanchez, household taxation continued to rise. More precisely, it takes on average 210 working days to fulfill tax obligations, compared to the 177 days required for this in 2018, when the motion of censure allowed Pedro Sánchez to form his first government. That’s 33 more days to pay for personal income tax, VAT, taxes and social security contributions.

share of taxes net salary 100,000 euros according to CCAA spain
Net salary on 100,000 euros of a single person according to the regions Spain / Source: Fundacion Civismo

The several Spanish governments have conducted various fiscal policies, showing, according to the Civic Foundation, a obvious long-term inconsistency. Governments of the same political color have also applied diametrically opposite fiscal measures (this is the case of Mariano Rajoy’s government), generating long-term mistrust and uncertainty among taxpayers about the amount of taxes they will have to pay in the next 5 to 10 years.

Tax exemption day following the autonomous communities

Also, the date of July 13 is a national average and this tax exemption differs for each territory. In autonomous communities such as Catalonia, Cantabria, Castile-La Mancha, Valencia and Asturias, it comes later than the Spanish average. On the other hand, in Madrid, Murcia, Andalusia or the Canary Islands, this day comes a little earlier.

table of the day of fiscal liberalization 2022 following the CCAA in Spain
Fiscal Freedom Day in 2022 according to the regions of Spain / Fundacion Civismo

And in France?

As for France, this day was July 27 this year, according to calculations made each year by the Molinari Economic Institute, which published its new study on the tax and social pressure of the average worker in all member countries. The institute, on the other hand, makes a distinction between salaries and has calculated that the day of the tax exemption is April 13 (for those receiving the minimum wage), July 19 (for an average salary) or August 3 (double of the average salary).

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