Spanish Taxation System: Power, Administration, and Types of Taxes

Posted on Nov 26, 2024 in Law & Jurisprudence

Power Tax (Item 7)

Concept and Sources of Tax Power

The concept of taxation has evolved from a State imposition to an instrument for financing public expenditures. Tax power is the ability to establish tax rules, constitutionally recognized in Spain for various agencies:

  • State
  • Autonomous Communities
  • Local bodies

Tax power is the authority of public entities to create and levy taxes. There are primary and secondary tax powers: the primary power is assigned by the Constitution, and the secondary power is attributed by the holder of the primary power.

Native Power: Directly recognized by the Constitution.

Deriving Power: Attributed by those with original power, not directly by the Constitution.

The State holds the original tax power, exclusively vested by law. Its power is determined and limited only by the Constitution, while autonomous communities and local authorities are constrained by both the Constitution and laws.

Limits on Taxation Power

International Boundaries

International tax law comprises rules governing the exercise of financial power among States, sourced from:

  • International treaties
  • International custom
  • General principles of law

Supranational Limits: Community Law

EU law applies to Member States and the Union itself, consisting of primary law (treaties and amendments) and secondary legislation (regulations and directives):

  • Regulations: Directly applicable and binding in their entirety.
  • Directives: Mandatory in terms of results, but not means or procedures.

Taxation Power in the Spanish Constitution

State Taxation Power

The State has exclusive competence for the general Treasury, which includes the State Treasury and serves as the basis for other treasuries. The State’s powers include:

  • Establishing the state tax system
  • Establishing the tax system of local bases
  • Setting limits for Autonomous Communities’ tax systems

State power limits:

  • Article 31 of the Spanish Constitution (requires law for taxation)
  • No charges by popular initiative in tax matters
  • Unification of taxes by the General Budget Law (LG Budget)

Taxation Power of Autonomous Communities (CCAA)

CCAA’s financial power is subject to the State’s scope, exercised by their parliaments. Resources include:

  • Taxes wholly or partially delegated by the State
  • Surcharges on state taxes
  • Own taxes, fees, and special levies
  • Transfers (territorial compensation fund)
  • Allocations from the General State Budget
  • Revenues from property and private law income
  • Credit operations

CCAA taxation power limits:

  • Constitutional Limits: Coordination of State Treasury, solidarity among Spanish regions, territoriality, and Single Market principles.
  • State Law Limitations: No taxes on already taxed items by the State (no duplication of taxable events), with financial compensation if the State taxes events already taxed by CCAA.

The State can:

  • Regulate CCAA powers
  • Set rules for financial activity conflicts
  • Establish harmonization principles
  • Control CCAA budgets

Taxation Power of Local Authorities

The Constitution recognizes local corporations’ financial autonomy, with resources from own taxes and participation in State and CCAA revenues. Local authorities have normative power but cannot create taxes; they implement and manage taxes created by state or autonomous law. They can delegate this power and must cooperate with other authorities.

Administrative Regulatory Powers

Government entities develop laws through regulatory powers, integrated into the legal system. These administrative powers in tax law are called tax rights and duties. Financial management is carried out by central or peripheral bodies, limited by the principle of hierarchy.

Tax Administration (Item 8)

Concept and Organization

The State exercises financial power through the Treasury (tax administration), responsible for fiduciary powers and compliance with tax regulations.

Central Administration: Ministry of Finance

The Ministry has political and administrative roles, headed by a cabinet member. It comprises four Secretariats of State:

  • Economy
  • Finance
  • Budgets and Expenditures
  • Trade, Tourism, and SMEs

The Secretariat for Economy and Finance includes:

  • Undersecretary General Técnica
  • General Directorate of State Assets

The Ministry of Finance includes:

  • Government Delegation in the Tobacco Monopoly
  • Directorate General of Taxes
  • Director for Coordination with Territorial Treasuries
  • Center for Cadastral Management and Tax Cooperation
  • Central Economic Court

Peripheral Administration

Delegations of economy and finance operate at autonomous community and provincial levels, handling tasks not assigned to the central government.

Tax Authorities: State Agency for Tax Administration

The State Tax Administration Agency is a public law corporation responsible for implementing the state tax and customs system. It is an autonomous entity, governed by administrative law, operating throughout Spain except for the Basque Country and Navarra. The Agency has faced criticism regarding its legal basis and alleged privatization attempts.

Governing Bodies: President (Secretary of State for Finance or designee) and CEO (appointed by the government). A Governing Board advises the President.

Organizational Structure: Departments of Taxation Management, Financial Inspection, Revenue, Customs and Excise, Computer, Human Resources, and Economic and Financial. Peripheral administration includes delegations and governments.

Staff Regime: Subject to labor legislation on civil service, with working conditions determined by collective bargaining.

Funding: From state budget transfers, collection percentages, revenue from other activities, own assets, and other public or private income.

Budgetary and Accounting Scheme: Annual budget proposal submitted to the ministry, subject to permanent financial control and public accounting.

Police Unit for Tax Fraud: Specialized unit collaborating with the Agency, organically dependent on the Interior Ministry but functionally integrated with the tax office.

Other Tax Administrations

Autonomous Tax Administration

Autonomous communities have tax administrations similar to the state’s, with branches under ministries or departments. Central bodies may have territorial organs.

Local Tax Authorities

Municipal administrations manage local taxes, with the full council approving budgets and taxes. The mayor orders payments, and a special committee reviews accounts.

Institutional Entities

These include professional associations, chambers of commerce, and communities of irrigators. Financial administration typically involves:

  • Tax office for charge management and collection
  • President/director for ordering expenses and payments
  • General state intervention for oversight and inspection

Public Income Tax (I) (Item 9)

Taxes: Concept and Characteristics

Taxes are government revenues required by public administration upon fulfillment of a legal obligation, primarily to finance public expenditure. Characteristics:

  • Public Revenue: Imposed by the State or public entity for public activity (public law).
  • Cash Benefit: Usually a sum of money, sometimes payable with Spanish heritage assets.
  • Coercive Provision: Based on law, not arbitrary force, limited by legality and economic capacity principles.
  • Not a Penalty: Aims to finance public bodies, unlike sanctions for legal violations.

Classes of Taxes

The taxes are classified into three categories, rates, special charges and taxes. The origin of this classification lies in the theories on fair share of the tax burden according to which each has to pay in taxes an amount proportionate to the value of benefits received from the State · Ratestaxes which are taxable event is the exclusive use or special use in the public domain, the provision of services or activities under public law relating affect or benefit a particular way to the taxpayer, when services or activities are not soliciting or receiving voluntary for the taxpayer or not pay or perform by the private sector. The rates are opposed to public prices. · Special contributions are taxes which the chargeable event is the acquisition by the taxpayer of a benefit or an increased value of property resulting from public works or the establishment or expansion of public services. Example: road paving work (collaborate citizens who are direct beneficiaries). · Taxes are taxes levied without consideration for which a taxable event comprises business, acts or facts that demonstrate the economic capacity of the taxpayer. The tribute is distinguished from · Income from the assets of the state (derived from private law relations). · Income from government bonds (resulting from a contract). · Fines (derived from an illegal action of the subject). The distinction between fee and tax and other figures. Tax. · Outside the provision of any public service or use of a public good. · There is no consideration. · Holding the principle of legality. · Foreign Public Law. · Rate · · involves a consideration of the public sector. · Voluntary principle: application of the provision. · Holding the principle of legality. · Foreign Public Law. · Private · Join The State will get them because of their involvement in the trading process. The State will act with their own property. · Foreign Private Law. · · Concept · Fees Fees are taxes which the chargeable event is the exclusive use or special use in the public domain, the provision of services or activities under public law which relate, affect or benefit from special way to the taxpayer when the services or activities are not soliciting or receiving voluntary for the taxpayer or not pay or perform by the private sector. It is necessary to meet two requirements: that the request is voluntary and that no service is performed by the private sector. · Economic point of view: An appropriate tax instrument to finance the current cost of public services severable. · Divisible into the meaning to be able to determine approximately when and how they can refer to a specific subject. · Legal Viewpoint: Relates to the structure of the taxable event. The will of the bound targets, we insist, if necessary, to the completion of the event and not to give rise to an obligation which, again, has its only source in the Law Class Destination: specific, generic and blended. · Perpetrator: State, CCAA, local autonomous bodies, trade unions and professional. · Service or activity: court (no longer exist), academic, industry, … · Inclusion in the general state budget: tax (provided for in the budget) and para. Distinction between retail price, rate and public prices differ in the fees for the peculiar arrangements for its establishment and quantification, essentially entrusted not to the law or ordinance, but the executive organs of state or municipal.Thus the public money is a tribute abnormal, a para-fiscal levy which is in the nature of the fee. Under the current wording of the Act, is that rates differ from the public at prices they can not be consideration of the use of public domain, or the benefit or activities or unsolicited services voluntarily. Public prices: monetary compensation which is satisfied by the provision of services or activities under conditions of Public Law when the following circumstances: ß that the services or activities are not soliciting or receiving compulsory by administrators. ß that foreign services or activities are likely to be rendered or performed by the private sector. The rates and the principles of legality and economic capacity As regards the principle of economic capacity and all he wants for the law is that payment performed by the person liable to pay the fees under the principle of capacity to do that this is necessary to find a balance between what is paid and the service they received. The amount of the fee is general ceiling on cost of service. As tributes are the fees, must meet the principle of legality. The submission to the rule of law is different from the tax, since it itself has to be created by law. The operating concept and nature special contributions are those taxes which the chargeable event is the acquisition by the taxpayer of a benefit or gain value of their property as a result of public works or the establishment or expansion of public services. These are taxes that lead to the taxpayer a particular benefit or increase in value of property due to certain administrative actions. Classes · According to the foundation of the charge: improvement contributions and contributions for special expenses of the public body. · According to the agency that creates them. · According to its object. Meets two conditions: it is an administrative activity and must have a certain group of people who have a special benefit. The special contributions is a tool for dealing with investment spending of public works and establishing and / or increased public service. One of the expenditure is paid in taxes and the rest through special contributions and investment depends on which one is greater than another. So there are two parts when payable: · Indivisible => Tax · Divisible => special contribution => who will pay for more benefits. If the work is of more general interest than partial => most amount will be imposed. If the work is of more general interest partial => most will pay special contributions. If the public work is not done, the money is returned to the contributors. Orientations Spanish law’s scheme management agreements and enforcement is the later.: · Is set a global quota for all taxpayers and then spread between them. • The global share may not exceed 90% of the total cost for administration. · Your payment may be split for a maximum period of 5 years. · Those affected by the performance of the work or service may become administrative Taxpayers Association. · The revenue will affect the work or service s for which they are established. · Included in the budget of the local community.The increase in quasi-fiscal charge state activities, especially as we are now interested in providing activities and the creation of new entities and bodies immediately mean increased public spending and, consequently, the need for new revenue. If new requirements are presented at a time that even without them, the tax system is inadequate and does not proceed to its reform, the solution must come from other sources, in this case, via the quasi-fiscal charge . The quasi-fiscal taxes are then used also to help the poor tax system and help ease the financial burdens of every kind thought and the State. The quasi-fiscal taxes are those taxes which, having been established by the State, resulting from its financial power have certain deviations from normal tax revenues are either required by bodies or agencies outside the State’s financial administration, or not wholly or partly admitted by the Treasury, or are not integrated into the general State budget, or integrated in the equally not intended to cover the expenses but that affect a particular public expenditure, ie not are integrated, not fused with the rest of the budget revenue. The quasi-fiscal charge is, therefore, a negative concept. They are not para-fiscal taxes. The quasi-fiscal charge of a charge may well be of varying degrees.

ITEM 10 PUBLIC INCOME TAX (II): TAXES. Taxes. Taxes are taxes levied without consideration for which a taxable event comprises business, acts or facts that show the taxpayer’s economic capacity as a consequence of possession of property, movement of goods or acquisition of income or expense. It is the tax bracket that gives the state more revenue. Economically: · is a financing instrument for public services indivisible, they have a particular recipient. • The pattern should be used to distribute taxes is the ability to pay. Classes The economic capacity of an individual depends on his wealth, and this is evident in a direct and immediate possession of assets or in obtaining an income. The taxes levied on income and wealth are to that effect direct taxes levied on wealth and itself directly and immediately concerned; taxes on income or wealth. Examples: income tax, I s / s. Indirect taxes are levied, is specifically designed to indirect manifestations of the economic, such as circulation or consumption of wealth tax on consumption. Example: VAT. From a legal standpoint, in direct taxes, the tax burden falls on the taxpayer and not allowed to pass on the cost of the tax to others. The Public Doing collected directly from those who want the tribute. In contrast, indirect taxes, was legally allowed to pass on the tax paid to a third party. The Administration collects the tax indirectly. Taxes are taxes subjective and objective targets those levied a certain wealth without taking into account the personal circumstances of the taxpayer. Subjective taxes are those where the taxpayer’s personal situation is taken into account in some way to determining the existence and amount of the tax liability.Real and personal taxes. The actual taxes are those levied a manifestation of the wealth that can be thought without putting it in relation to a particular person. The focus is the thing. Example: VAT is a function of the good or service. Personal taxes are those levied a manifestation of the wealth that can not be thought without putting it in relation to a particular person. Refers to the person. Example: Personal income tax revenues depend on each person. Taxes are taxes instant instant newspapers whose taxable event is exhausted by their nature in a certain period of time and is taken into account by the Act only as fully realized. It begins and ends with the fact taxed. Example: donation. Periodic taxes are those whose budget is in fact a condition or state is prolonged indefinitely in time. Example: income (from 1 to 31 of every month). The technique used for this is to split the taxable event, in its duration, in different periods, tax periods. Taxes ordinary and extraordinary. The ordinary taxes are born with a desire for permanence. The special taxes arise for a period of time.