All the fiscal measures approved by the Government: lowering of personal income tax, new tax on the rich…
The Government will punish high incomes and reward workers with gross incomes of less than 21,000 euros
The Government has just approved a new tax package for the years 2023 and 2024 that will include incentives for low incomes and new taxes for companies and high incomes. These are the measures announced by the Minister of Finance, María Jesús Montero and that will be included in the 2023 Budget, will come into force on January 1 and will be in force until the end of 2024.
Tax reduction for income less than 21,000 euros
The Executive includes in its package a tax reduction in personal income tax for income of less than 21,000 euros gross per year. Until now, this reduction was focused on taxpayers with incomes of 18,000 euros. Specifically, the formula chosen by the Government is to expand the tax benefit, instead of touching the sections or rates.
This reduction will affect, according to government calculations, 50% of workers, who will achieve savings of 1,881 million euros. For example, a worker without children who earns 18,000 euros will be able to save up to 746 euros per year.
The exempt minimum becomes 15,000 euros
In addition, the Treasury plans that income of up to 15,000 euros be exempt from paying personal income tax and therefore presenting the Income Statement. Until now, that maximum was established at 14,000 euros. This measure will be accompanied by an increase in the minimum wage, which will prevent fiscal distortion.
Increase in capital income
On the other hand, the Government will tax higher incomes more. A tax increase on capital income of more than 200,000 euros is approved, going from 26 to 27%. For capital gains greater than 300,000 euros, for its part, the new rate will be 28%.
Temporary tax on the rich
The Government will also create a temporary tax, which will be in force in 2023 and 2024 to tax the rich. Specifically, it will affect citizens with wealth of more than 3 million euros and will have three sections, from 1.7% to 3.5%. So that this new tax does not entail double taxation, the amount paid by assets to the autonomous communities will be fully deductible. This also means that the new tax will ‘de facto’ deactivate the tax advantages in force in the Community of Madrid and those that Andalusia has just approved. The Government expects to raise 1,500 million euros with this measure, which will affect some 23,000 people.
Changes in corporate tax
There will also be changes in corporate tax. A reduction in the nominal rate of the tax will be applied from 25 to 23% for small companies, which will enjoy savings of 292 million.
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On the other hand, for large companies, the Treasury will limit the ability to compensate the losses of its subsidiaries to 50%, which will put 2,439 million euros in the State treasury (and will remove company funds) between 2023 and 2024. No Only the Ibex companies will pay it, but this change affects 3,000 corporations.
Winks to the self-employed
A part of the government’s fiscal package will go to the self-employed. The Executive will reduce the net income of the self-employed workers modules by an additional 5%. In addition, it increases by two points, up to 7%, the reduction of deductible expenses without justification. The Executive expects to benefit with this measure 578,000 self-employed in the case of modules and another 956,000 in the direct estimate regime.