Economists ask to eliminate the Wealth Tax because it is "anecdotal" and see the struggle between institutions as unsustainable

At a time when some autonomous communities are introducing tax credits in the Wealth Tax and the Inheritance and Donation Tax, and awaiting the ruling of the Constitutional Court regarding the Temporary Solidarity Tax of Great Fortunes and the Wealth Tax, This Monday, the General Council of Economists presented a report under the title 'Taxation of wealth: state of the art'.

Economists believe that the distortions that they can produce and the collection that can be achieved through the Wealth Tax make its suppression advisable – preventing the possibility of it being regulated by the regional treasuries as their own tax -, although it could remain as a declaration census.

However, economists believe that if it were decided to maintain the tax, it would be advisable to introduce changes, homogenizing the tax base and the exempt minimum in all territories.. And, for example, according to their calculations, if this tax were not subsidized in Madrid, the total collection would have been about 2,000 million euros, instead of 1,300 million.

The fiscal experts of the General Council of Economists have analyzed the collection data of taxes linked to wealth and, with practical assumptions, have revealed the inequalities that occur between taxpayers with the same wealth depending on their place of residence, also incorporating the latest modifications approved by the Autonomous Communities.

Thus they calculate, for example, that a taxpayer with an asset of 15 million euros, in 2023 would not pay anything for Assets in Andalusia, Extremadura and Madrid and, however, in the Valencian Community he would pay 401,234 euros, although this situation, temporarily, It is partially mitigated by the application of the Large Fortunes Tax.

The president of the General Council of Economists, Valentín Pich, has stated that if it is considered that Spain has a completely globalized economy, that the Wealth Tax is “anecdotal” in all tax systems and presents technical and equity problems in the territory, so it considers that the reasonable thing would be to eliminate it. In the case of the Inheritance Tax, Pich considers that, although it is also subject to debate, certain changes could be addressed so that it can play a redistributive role and to strengthen equal opportunities.

Given the appeals that have been presented against the Wealth Tax and against the Solidarity of the Great Fortunes, Pich has assured: that he “honestly believes that it is an unsustainable situation that is unnecessarily straining the legal system and introducing too much institutional conflict.”

The president of the REAF-CGE, Agustín Fernández, expressed that “the Temporary Solidarity Tax of Great Fortunes should not be made permanent because it is configured as a patch to the Wealth Tax and has been approved following a unique parliamentary trajectory.”

As economists have argued, the reason why wealth is taxed can be found in the fact that it is a manifestation of economic capacity different from that of income and consumption, and it can complement the tax on both manifestations.. “As a country, we are totally immersed in the global economy and, therefore, we compete with the rest of the countries in Europe and the rest of the world, so our economic regulation and, within this, tax regulations, do not may distance itself too much from the prevailing standards,” they stressed.

Thus, the General Council of Economists has insisted that it is not about competing fiscally downwards, which has not been a tax policy used in the country, but rather that taxes, at least, do not penalize certain taxpayers being able to come to reside in Spain or not encourage others to relocate.