B Law & Tax
22 January 2024

Tax Advisor: Regional Discounts in the Wealth Tax

The 2022 Wealth Tax Manual from the AEAT reports that when filing the Wealth Tax declaration for the 2022 fiscal year, seven autonomous communities (Andalusia, Aragon, Asturias, Balearic Islands, Catalonia, Galicia, and the Community of Madrid) offered regional discounts at different percentages. Later, Extremadura joined, and recently, Cantabria implemented a general discount starting with the 2023 declaration. These regional discounts are typically applied after state deductions and discounts, reducing the tax amount by a percentage that can reach 100%. However, due to the dismissal of appeals against the Temporary Tax on Solidarity of Great Fortunes (ITSGF), some common regime autonomous communities have adjusted their Wealth Tax discounts. 

 

Andalusia: 

Initially, the region grants a complete 100% discount on the positive quota of the Wealth Tax, according to Law 5/2021, from the 2022 fiscal year. However, Law 12/2023 established a specific regime for the discount during the validity of the Temporary Tax on Solidarity of Great Fortunes (ITSGF), effective since December 30, 2023. During this period, taxpayers can choose between two discounts in the Wealth Tax quota. 

  1. A discount determined by the difference, if any, between the total gross quota of the Wealth Tax, after applying the joint limit established in Article 31 of the LIP, and the total gross quota corresponding to the ITSGF, after applying the joint limit of Article 3.Twelve of Law 38/2022, of December 27.
  2. The general Wealth Tax discount mentioned above.

 

Aragon: 

This autonomous community maintains an unchanged discount intended for specifically protected assets of taxpayers with disabilities. According to Article 150-1 of Legislative Decree 1/2005, holders of a protected heritage regulated by Law 41/2003 can apply a 99% discount on the proportional quota to the assets or rights included in that heritage, with a limit of 300,000 euros. No discount is granted for the rest of the heritage. 

 

Asturias: 

The discount in this autonomous community remains unchanged compared to the 2022 fiscal year and is similar to Aragon’s. According to Article 16 of Legislative Decree 2/2014, if the assets or rights included in the taxable base are part of the specifically protected heritage of the taxpayer according to Law 41/2003, a 99% discount can be applied to the proportional part of the quota corresponding to those assets or rights. 

 

Cantabria:

The Cantabria Law 3/2023, in force since January 1, 2024, introduced a new Article 4 bis to Legislative Decree 62/2008 that grants a general 100% discount on the quota. However, an additional third provision of the same law establishes that this discount will not apply when the net wealth of the taxpayer exceeds 3,000,000 euros after subtracting the exempt minimum of 700,000 euros and when the mere possession constitutes the taxable event of a state tax. 

 

Catalonia: 

In Catalonia, two discounts in the Wealth Tax remain unchanged:

  1. A 99% discount on the proportional quota for assets or rights that are part of the protected heritage of people with disabilities, according to Article 2 of Law 7/2004, of July 16, on fiscal and administrative measures. It applies to both protected heritage of the taxpayer according to Law 41/2003, of November 18, and according to Law 25/2010, of July 29, of the second book of the Civil Code of Catalonia, related to the person and the family.
  2. A 95% discount on the proportional quota for forest properties, provided they have a duly approved management plan by the competent forestry administration.

 

 

 

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