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Fiscal year 2018

Effective rates

The average effective rate on income and spending remained practically at the same level as 2017. In 2018 there were some regulatory changes, but they were offset by the evolution of bases and prices. The average rate has remained almost unchanged at around 15% since 2013.

The effective rate on household gross income also remained stable in 2018 (Table 2.1). Stability hides three elements that affected the rate in 2018 and that are of different signs, one upward and two downward. Firstly, the average withholding rate on salaries and pensions increased, 1% in the first case and 2.2% in the second (Table 2.3). In salaries, the result contrasts with the stability of the previous two years, after the tax reform. The cause of the change is the increase in average salaries (also unlike previous years) and the drag that this produced on the average withholding rate. In pensions, the rate increase is part of the normal evolution when pensioners with a pension and a higher average rate join the system. However, and this is the second element, both increases were limited in the second part of the year, after the approval of the Budgets, when the reduction for work income was expanded with the consequent reduction in the rate of wages and lower pensions. . Finally, a third element that influenced the rate downwards were the new family deductions, whose effect will only be complete in the annual declaration (the expansion of the old family deductions only had a small effect on the anticipated deductions in 2018 and others, such as daycare expenses, can only be applied in the annual declaration). This last element is what explains that, although the average rate did not grow in 2018, the estimated rate did (1%) without including the differential quota and family deductions.

The effective corporate tax rate in 2018 was 21.3% based on the aggregate tax base and 9.9% if calculated based on the positive accounting result. In both cases it represents an increase compared to 2017 which, in the absence of regulatory changes, as is the case, must be attributed to composition effects (the bases of companies with a higher effective rate grow more). In any case, the rate in 2018 is not far from the average of the last 10 years.

In VAT there were also no significant regulatory changes (only the reduction of the rate in cinemas and for half a year) so the average rate remained close to 15.3%, which is the level reached after the last rate increases. general and reduced in September 2012.

In Special Taxes (II.EE.), the variation in the rate observed in 2018 has to do, as happened in 2017, with the rise in energy prices. It must be remembered that, in order to obtain an average aggregate rate, the II.EE rate. It is calculated, in this section, on the value of consumption, although in some of these figures (especially in the Hydrocarbon Tax) the base is physical consumption, not value. It was precisely in the Hydrocarbon Tax in the figure where the only regulatory changes occurred, although of marginal amount. These changes came from the approval of RDL15/2018, urgent measures for the energy transition and consumer protection, which included the elimination of the tax on natural gas, diesel and fuel oil used in the generation of electrical energy.