Special rule: Exempt property and rights with progression

Regulations: Art. 32 Wealth Tax Law

Taxpayers subject to the Tax by personal obligation to contribute who are owners of assets or rights located or that can be exercised or must be fulfilled in a State with which Spain has signed a bilateral Agreement to avoid double taxation, by virtue of which said assets are exempt from Spanish Tax, but may be taken into account to calculate the Tax corresponding to the remaining assets, must determine the full amount according to the following procedure:

• The value of the exempt assets and rights, determined in accordance with the rules for the valuation of the Tax reduced, where applicable, by the value of the charges, liens and debts corresponding to them which, if there were no such exemption, would be considered tax deductible, must be added to the amount of the taxable base, in order to determine the basis for the application of the tax scale.

• Once the resulting quota is obtained, the average tax rate is determined . This average tax rate is the result of multiplying by 100 the quotient resulting from dividing the rate by the base for applying the tax scale.

• Once this average rate has been obtained, it will be applied exclusively to the taxable base , without including exempt assets and rights, except to determine the tax rate, also known as exempt elements with progressivity.