Gross tax bases

The aggregate tax base of the main taxes grew by 7.6% in 2023, six points below the rate reached in 2022, a year with strong price tensions and which was compared to a year 2021 that had not yet recovered normality ( Table 1.3 ). As a result of these two circumstances, the slowdown was concentrated in the bases associated with spending (3.6% compared to 19.6% the previous year), while the bases related to income exceeded by more than one point the record observed a year before (10.6% compared to 9.5%, Graph 1.14).

The lower growth of the bases related to spending is due, on the one hand, to the lower incidence of inflation, especially that associated with energy, which reduced the value of consumption subject to special taxes and, on the other, to a more moderate increase in spending subject to VAT .

In 2023, the gap that had been observed between the evolution of the bases and that of the commonly used reference macroeconomic indicator, domestic demand, narrowed, although the behavior of the former continued to be more positive than that of its indicator, as can be seen. see in Graph 1.15. Part of this discrepancy is explained because there are components in the bases that either do not form part of the macro indicator or their importance within the aggregate is different from what they have in the bases, but even taking these factors into account, the different evolution between bases and indicator in the indicated period represents an anomaly in the history of both series, as reflected in Graph 1.16, which shows the behavior of both aggregates in the last twenty-four years, taking the year 2020 as a base.

The aggregate tax base began the year with growth two points higher than that of the last quarter of 2022, a rebound explained by the favorable evolution of income and spending subject to VAT. However, in the second quarter, base growth slowed, with the exception of gross household incomes, which maintained growth of around 9.5% compared to 7.8% in the first quarter. During the second half of the year, the aggregate base once again recovered a greater intensity of growth, especially in the fourth quarter, driven by the good performance of the corporate tax base, the improvement in subject final expenditure and the smaller drop in the value of subject consumption. to II. Excise Duties, factors that compensated for the lower progress in gross household income. (Figure 1.17; The data in quarterly frequency of the graph can be downloaded at this link to the file of historical series of bases, rates and accrued taxes).

The gross income of households grew by 9% in 2023 ( Table 2.1 ), exceeding the rate of the previous year by more than one point. The greatest contribution to growth occurred, logically given that it is the main component, in labor income, although the increase was greater in capital income and income from economic activities (Graph 1.18).

Income from work and economic activities grew by 7.2% in 2023, a rate only four tenths lower than that at the end of 2022 and which is the result of disparate evolutions between its components (Graph 1.19 and Table 2.2 ). Thus, the wage bill increased by 7.6%, which represented a notable increase when compared to the average increase in the period between 2015 and 2019, which stood at 4.6%, but which implied a slowdown of two points compared to the rate reached in 2022, a slowdown that was concentrated in the private sector (Graph 1.20). Its evolution throughout the year was one of slight deceleration as a result of the progressive moderation in the pace of job creation and wage increases that were lower in the second part of the year (they went from growing around 5.5% in the first semester to be around 4.5% in the second). This profile was clearer in the private sector and, above all, in SMEs which was where the slowdown in employment was most noticeable. The wage bill of Large Companies grew by 9.6%, compared to 11.1% in 2022, while in the case of SMEs the increase was 6.6%, with a deceleration of more than five points compared to the 11.9% of a year before. For the year as a whole, the increase in the private wage bill was greater than 8% (11.4% the previous year). In public salaries, growth was also greater in the first part of the year, but in this case the slowdown had more to do with the intensity and way in which salaries were updated in 2022 and 2023 (in the first the correction was greater and in November). The final result of the year was an increase in the public wage bill of 5.6%.

Unlike what happened with the wage bill, the pension bill grew in 2023 more than one and a half points above the rate reached in 2022, 9%. The increase in public pensions was 9.4% and 11% since February (the January rate was negative when compared to the month that included the last update payment due to the price deviation). The mass of private pensions fell again, although less intensely than in recent years. The weight of these pensions on the total pension has been reducing over the years, so that in 2023 they represented around 3.5% of the total.

The last major element within these incomes, unemployment benefits, increased by 3.2% in 2023, after registering strong decreases in the two years after the crisis caused by COVID .

Household capital income (furniture, rentals and capital gains) grew by close to 20%. Income from movable capital increased again by around 30%. The novelty in 2023 was the contribution of interest from bank accounts. In 2022, the growth was due to the expansion of dividends that were compared to a year 2021 that included the effects on the distribution of profits of the 2020 crisis. In 2023, dividends also grew, but more moderately, and it was the interest on bank accounts that led to the rebound in these incomes. The starting situation was very low (not the historical minimum because the increase began to be noticed in the last months of 2022), but the increase was very significant, enough to raise these remunerations to levels higher than those in 2016 (Graph 1.21 ).

Also in rents derived from leases in 2022, relatively high growth was recorded compared to 2021, still without a complete recovery. In 2023 growth continued above 8%. And as far as capital gains are concerned, in 2023 they increased again by over 17% thanks to the behavior of the housing market and the stock market, and despite the fact that profits in investment funds were cut by almost half due to rising rates and competition from other forms of investment.

Finally, personal business income grew by 10% compared to 8.2% in 2022 ( Table 2.8 ). Its profile throughout the year was, as was the case with other variables linked to SMEs, one of deceleration after a good start to the year inherited from the good results that characterized the entire previous year.

The consolidated tax base of the Corporate Tax grew by 19.5% ( Table 3.1 ). It should be noted that this high rate is registered after two years of strong increases (36% in 2021 and 18.7% in 2022). The companies' profits increased by more than 10% in 2023. In the case of Large Companies and groups, the profits declared in their third interim payment presented in December grew by 15.4% ( Table 3.2 ), with the largest increase in Large Companies (17%) than in the groups (14.3%). Growth was very high in the first months of the year, especially in the groups (and, especially, in the energy and financial sectors), it moderated in the central part of the year, which was also compared to very good results for the year previous, and recovered in the final stretch of the year.

final expenditure subject to VAT grew by 7.1% in 2023, almost nine points below the increase achieved a year earlier (Table 4.1) . For the accounting approximation to the subject final expenditure, a similar increase is estimated (7.5%), although the sign of deceleration is less in this case, due to the already mentioned discrepancy that has been observed between the bases and their accounting indicators in the period 2021-2022 and which has represented an anomaly in the history of both series (Graph 1.22). Spending growth in 2022 was clearly affected by the inflationary cycle that began in mid-2021 and by the fact that tourism spending in 2022 was still recovering from pre-pandemic levels. Both factors help explain part of the slowdown in 2023, although this is also evident, although less intense, in the evolution of spending in constant terms, which goes from growing 7% in 2022 to 3.2% in 2023 (Graph 1.23). By components, all of them (household spending, purchase of new housing, Public Administration consumption) recorded lower rates than the previous year, although the component that suffered the greatest slowdown was household spending.

The value of consumption subject to Excise Taxes decreased by 13.9% in 2023 ( Table 1.3 ). The main reason for this decrease is the drop in the value of the two components with the greatest weight in the total, that is, hydrocarbons and electricity, a consequence in turn of the sharp reduction in their prices after the high levels reached the previous year ( Tables 5.7 and 9.1 and Chart 1.24). To this factor we must add the drop in consumption. The value of alcohol consumption and intermediate products decreased slightly despite the increase in prices, since this caused a drop in consumption. Finally, the value of beer and tobacco consumption increased, driven by an increase in the pre-tax price of 13% and 10.6% respectively ( Table 9.2 ), while consumption They remained almost constant in the case of beer and decreased in the case of tobacco.