Key tax and fiscal issues and developments for 2023
In a month of unbridled legislative activity in December, numerous laws have been passed which have an impact on different areas of the law and of which we would like to highlight mainly those referring to taxation and fiscal aspects.
Among the most noteworthy measures, we would like to mention the following:
- Law 28/2022, of 21 December, on the promotion of the ecosystem of emerging companies, also known as the Startups Law, which offers very interesting benefits and incentives for entrepreneurial companies, their investors and their employees (access the article).
- Law 31/2022, of 23 December, on the General State Budget for 2023, which we summarise here.
On the other hand, on 27 December last, two regulations with temporary tax measures were approved:
- Royal Decree-Law 20/2022, of 27 December, on measures to respond to the economic and social consequences of the war in Ukraine and to support the reconstruction of the island of La Palma and other situations of vulnerability. The regulation, which came into force on the same day of its publication, 28 December, includes numerous measures in different areas, so we refer to those containing tax effects on VAT and the temporary reduction of its tax rates that affect:
- Deliveries, imports and intra-Community acquisitions of natural gas, briquettes and pellets from biomass and wood for firewood. With effect from 1 January 2023 and valid until 31 December 2023, the application of the 5 % VAT rate is extended and the equivalence surcharge will be 0.625 %.
- Deliveries, imports and intra-Community acquisitions of electrical energy. The 5% VAT rate is extended until 31 December 2023 for deliveries, imports and intra-Community acquisitions of electricity made in favour of certain contract holders receiving the social bonus or with contracted power of less than 10 kW.
- Supplies, imports and intra-Community acquisitions of disposable surgical masks: Supplies, imports and intra-Community acquisitions of certain goods and services necessary to combat the effects of SARS-CoV-2, which are basically products for in vitro diagnosis, vaccines and transport, storage and distribution services, will be taxed at a rate of 4% until 30 June 2023 and 0%.
- Certain intra-Community deliveries, imports and acquisitions of foodstuffs. With effect from 1 January 2023 and valid until 30 June 2023:
- VAT rate of 5% and 0.625% surcharge on the following products: Olive and seed oils and pasta. If the underlying inflation rate in March 2023 is less than 5.5%, 10% VAT and 1.4% of the equivalence surcharge will be applied from May onwards;
- 0% rate of VAT and the equivalence surcharge on the following products: Plain bread, as well as frozen plain bread dough and frozen plain bread intended exclusively for the production of plain bread; bread-making flours; certain types of milk; cheeses, eggs and fruit, vegetables, vegetables, pulses, tubers and cereals, which have the status of natural products in accordance with the Food Code. As in the previous case, the applicable tax rate will be 4 per cent as of 1 May 2023, in the event that the year-on-year rate of underlying inflation for the month of March, published in April, is less than 5.5 per cent. The rate of the equivalence surcharge applicable to these transactions shall be 0.5 per cent.
- Law 38/2022, of 27 December, for the establishment of temporary energy taxes and taxes on credit institutions and financial credit establishments and which creates the temporary solidarity tax on large fortunes, and modifies certain tax regulations.
On 29 December, the regulation came into force, approving three extraordinary taxes that will take effect from 2023 (although referring to 2022) and will be applicable for two years.
The Energy Levy will tax 1.2% of the turnover of energy companies with a turnover of more than 1 billion euros in 2019, excluding income derived from activities at regulated prices. It also regulates some exemptions and the limitation of taxation on activity generated in Spain.
In relation to the taxation of credit institutions and financial credit establishments, it will affect the activities that these institutions carry out in Spain and will tax at 4.8% the interest of institutions with a turnover of more than 800 million euros in 2019.
The third tax is the Solidarity Tax on large fortunes, which establishes a rate of 1.7% for assets between 3 and 5.3 million euros; 2.1% for assets between 5.3 and 10.6 million euros, and 3.5% for assets of more than 10.6 million euros.
In order to avoid double taxation, Solidarity Tax taxpayers will be able to deduct the amount of Wealth Tax.
For this reason, some autonomous communities have increased their taxation so that the increased revenue remains in their coffers.
In this sense, the Generalitat de Catalunya has approved by Decree Law 16/2022 a new temporary tax bracket which, from 20 million, has a rate of 3.48%.
The Law also amends other tax regulations, including the following:
- In Wealth Tax, shareholdings held by non-residents in non-resident entities with underlying real estate assets located in Spain will be taxable.
- In corporate income tax, a temporary measure is incorporated in the determination of the tax base in the tax consolidation regime so that, for years beginning on or after 1 January 2023, for the purposes of calculating the tax base of the group, positive taxable income will be aggregated, but only 50% of the negative taxable income will be aggregated. From 2024 onwards, the negative tax losses not included may be incorporated during the following 10 years in equal parts.
On the other hand, the limits of the deduction for investments in Spanish and foreign film productions and audiovisual series are increased, and allow the application of the deduction by the taxpayer who finances the costs of the production of Spanish productions of feature films and short films, audiovisual series and live shows of performing arts and music.
Finally, it should be remembered that on 1 January last, the Tax on Non-Reusable Plastic Packaging came into force, on which we sent out a recent information note.
In this regard, on 30 December, Order HFP/1314/2022 was approved, approving the settlement and refund application forms, as well as obligations such as registration in the register and bookkeeping.