Wealth tax in Andalucia, abolished

The wealth tax in Andalucia, abolished

The wealth tax in Andalucia and in Spain is a historic tax. In short, it taxes the net value of all assets, deducting the debts of the owner. The tax is due on 31 December of each year and will affect the assets owned on that date. You can read more about annual property and income taxes.

Created by the law of 1977, it is currently regulated at the national level by Law 19/1991. In 2008, the goberment agreed a 100% rebate, reinstated again and in 2011 and 2012 with an exemption of 700,000€. Since then, the tax has remained in force.

Other countries such as Switzerland and Norway also have this tax. Also in France and Belgium, it exists, but it has a different name.

Who pays this tax in Spain?

The taxpayers obliged to pay this tax are those who have a net worth of more than 700,000 euros. Although there is an exemption of 300,000 euros for the main house. In practice, only paid by 0.2% of taxpayers in Spain. In other words, all those with assets of more than one million euros will have to pay this tax. 

Good news for Andalusians

Since 2014, several attempts to remove it have failed at the national level. Although it is a national tax, each autonomous community manages in a  different way. Only the community of Madrid has been granting 100% of this tax since 2008. On 20 September 2022, the Junta de Andalucía decided to completely abolish the Wealth Tax. This will come into effect in 2023 and from then on property owners in Andalucia will not have to pay any Wealth Tax at all. 

Andalusia will be, the second autonomous region in Spain to abolish this tax. This will make it far more attractive for large capital investments.

Real Estate Investment

The real estate sector may enjoy this new measure. Somewhat alleviating the current economic downturn, which may be holding back luxury homebuyers. This will result in annual savings for domestic and foreign buyers wishing to buy a second home. It will also benefit those who wish to settle in Andalucia, and so on the Costa del Sol. 

Below you can see an example of the estimated collection for 2022. It now represents a greater saving for larger fortunes.

Net base up to (€)	Quota full (€)	Remaining tax base up to (€)	% Applicable rate
0,00	0,00	167,129.45	0.2
167,129.45	334,26	167,123.43	0.3
334,252.88	835,63	334,246.87	0.5
668,449.75	2,506.86	668,499.76	0.9
1,336,999.51	8,523.36	1,336,999.50	1.3
2,673,999.01	25,904.35	2,673,999.02	1.7
5,347,998.03	71,362,33	5,347,998.03	2.1
10,695,996.06	183,670.29	En adelante	2.5

All these amounts are now saved with the abolition of the wealth tax in Andalusia.

What do you think about this new measure by the Andalusian government?

What do you have to say about wealth tax in Andalucia? Are you one of the lucky ones?

Tell us your opinion in the comments.

Sources:
Impuesto de patrimonio Andalucia