5. Special Taxes
The Excise Taxes were the ones that, among the major figures, had the worst results in 2021. Revenue from these taxes grew by 5% to €19.729 billion, and at the end of the year was still 7.7% lower than in 2019. Many different factors influenced this overall result. In the Hydrocarbon Tax, revenues increased by 11.3%, but in 2020 they had decreased by 15.8%. Its evolution throughout the year was one of progressive improvement, but not at a pace sufficient to reverse the decline of the previous year. The mobility restrictions that still existed at the end of 2020 and the first months of 2021 and the effects of the Filomena storm at the beginning of the year, together with the sharp rise in prices, hampered the recovery. The drop recorded in the Tobacco Tax (-2.1%) is the fifth consecutive one in recent years. Consumption remained practically stable, and average prices fell (due to increased consumption of cheaper varieties) despite increases in the most representative brands in the last quarter. In the case of the Electricity Tax, the decrease in revenue (-12.2%) is explained by the rate reduction in force since mid-September, which is estimated to have an impact of 336 million. With this amount, revenues would be roughly at the same level as in 2019, with prices higher than those then. In alcohol taxes, after a very negative start due to poor consumption data at the end of 2020, high rates were recorded that brought growth in the year to 7%, but revenues never exceeded those of 2019 (-12.9% compared to that year).
In 2021, all consumption of products subject to II.EE. increased. ( Table 5.1 ), driven by the relaxation of mobility restrictions and other limitations, growing more intensely in those cases where the incidence of the pandemic was higher in 2020, as is the case with gasoline and diesel (11.4%) or with alcohol (33.2% for the highest alcohol content). Consumption of beer (7.5%) and electricity (2.7%) also increased, while tobacco consumption remained practically stable (0.4%, 0.2% for cigarettes). However, these increases were not sufficient to reach 2019 levels in any product.
A notable factor in 2021 was the rise in prices, especially at the end of the year, with the increase in energy prices standing out, with very sharp increases since March. Thus, the average price of gasoline and diesel fuels grew by 18.5% (29.9% before taxes; Table 9.1 ) due to increased demand throughout the year and global tensions that pushed the price of a barrel of oil in euros up by over 65%. In electricity, the pre-tax increase was 14.8%, although the retail price was reduced to 7.4% thanks to the radical reduction in the rate that occurred in mid-September ( Table 5.7 ). The average prices of alcoholic beverages, on the other hand, barely changed compared to the previous year ( Table 5.2 ) and the increase in beer was minimal (0.6%, Table 5.3 ), while the average retail price of tobacco products fell by 0.7%, since the increase in the price of other products was not sufficient to offset the lower average price of packs ( Table 9.2 ). Consequently, the value of products subject to II.EE. (before VAT) increased by 19.9% thanks to the recovery process in consumption and the notable rise in the prices of energy products ( Tables 1.3 and 5.1 ).
As regards the effective rates, the only regulatory change in 2021 was the drastic reduction in the rate on the Electricity Tax since mid-September (from 5.11% to 0.5%). The estimated impact of this reduction in 2021 reaches 336 million euros ( Table 1.5 ). But, as can be seen in Table 5.1 , there have been other variations in the rates. The changes that have been recorded in the last two years in the effective rate of gasoline and diesel fuel are noteworthy, due to changes in the composition of consumption of the different products. Thus, the largest drop in 2020 in products with higher rates, such as gasoline, resulted in a drop in the average rate, while in 2021 the opposite effect occurred. This composition effect is also observed in the variations in the excise tax per litre of beer.
The Excise Taxes accrued grew by 7.1%, remaining still more than 1.5 billion below the level reached in 2019 (-7.1%, Table 5.1 ). Taxes on alcohol and hydrocarbons increased in line with the recovery in consumption, and so would have been the case with the tax on electricity had it not been affected by the rate reduction. In fact, in the absence of a rate change, this figure would have been the only one to remain at levels similar to those recorded two years ago. Of the 1.5 billion euros less accrued compared to 2019, more than 700 million are concentrated in the Tax on Hydrocarbons and more than 300 in the Tax on Tobacco Products, which is combined with stagnant consumption and lower prices. The tax on coal is falling for another year as its use as a raw material for electricity generation is very residual.
The Hydrocarbon Tax increased by 13.6% ( Table 5.5 ) after the sharp drop in 2020. The increase exceeds the increase in consumption by almost two points due to the rise in the average rate resulting from greater use of products taxed at higher rates. As with other taxes, the evolution throughout the year is almost a reflection of what happened the previous year, with a first quarter in which the decline continued due to the impact of Filomena and the restrictions still in force due to the pandemic, a second quarter of strong rebound in response to the drastic fall in 2020, followed by a final semester in which the increase in prices partly slowed the advance of consumption. Gasoline, the product most closely linked to consumption, grew by 24.1%, remaining only 1.9% below the pre-pandemic level, while automotive diesel, more closely related to transport, despite increasing by 11.5%, remained at consumption levels much lower than those of previous years (you have to go back to 2014 to find a lower level of consumption).
The accrued Tobacco Tax decreased by 0.8% in 2021 (-5.0% compared to 2019, Table 5.6 ), due to stagnant consumption and lower prices. The decline was greater in cigarettes (-0.8%) than in other occupations (-0.5%), which breaks the upward trend that has been observed over the last three years. This new reduction leaves the tax at levels substantially lower than the average observed in the period 2013 to 2019.
The Electricity Tax was reduced by 20% ( Table 5.7 ), affected as already mentioned by the sharp drop in the rate (from 5.11% to 0.5%) that came into force in mid-September. Consumption grew in 2021, but the most notable thing was the sharp price increases in the wholesale market that intensified from mid-year. Prior to the drastic reduction in the rate, the increase in the tax accrued and, therefore, in revenue was not so intense, in addition to the gap between consumption and invoicing, because the invoice includes other elements that soften the impact of the rise in prices in the wholesale market and because the percentage of consumers who are in the free market is high.
The alcohol tax recorded significant growth in 2021 (33.2%; Table 5.2 ), which was however not enough to offset the sharp drop of the previous year, so that it remains almost 5% below the amount reached in 2019, conditioned by the situation of the hotel and restaurant sectors, which remained subject to restrictions for part of the year and have not yet recovered from the impact of the pandemic. Something similar happens with the Beer Tax, with an increase in 2021 of 8.7% (-2.2% compared to 2019; Table 5.3 ).
The coal tax was reduced again by 9.4%, to 31 million. As has been mentioned in other reports, this figure has a residual role within the system, once the use of coal in electricity generation was abandoned by the largest producers.
The collection of Special Taxes increased by 5%, reaching 19,729 million, remaining 7.7% below the amount collected in 2019 (1,651 million less; Table 5.1 ). Its growth is more than two points below that corresponding to the accrued tax due to the shifting of the last accruals of 2020 (most affected by the crisis) to the 2021 cash flow and, of the last accruals of 2021, which reflect the better performance of consumption, to the 2022 cash flow. This is especially relevant in the Hydrocarbon Tax (11.3%, more than two points below the accrual) and in taxes on alcohol (7% in cash compared to 13.5% of the accrual).
In the case of the Electricity Tax, however, the effect is the opposite (-12.2% in cash and -20% in accrual) due to the reduction in the rate in the final part of the year.