3.1. Gross tax collection

The gross amount of tax collected comprises the effective incomes obtained in the fiscal year from both the self-assessment tax returns filed by taxpayers and from the settlements carried out by the Tax Agency. It is therefore set on a cash basis.

The total gross revenue managed by the Tax Agency in 2020 reached 248,347 million euros, 18,377 million less than that achieved in the same period of the previous year (6.9 percent decrease).

The year was marked by the pandemic, which hampered economic activity and, with it, the evolution of the aggregate tax base, the main element when explaining the behavior of gross income. The tax bases for the main taxes are expected to fall by around 8 percent. However, there are other factors that positively affected the annual evolution of gross income, such as the existence of extraordinary income and the impact of some regulatory and management changes in 2019 that affect the rate of variation between both years.

All indicators of economic development showed the same profile, both general (GDP, affiliates) and those from tax information (daily sales from the SII and sales, employment and wages in tax returns). The deceleration trend inherited from 2019 was radically altered in the second half of March when the state of alarm and home confinement were declared. This caused a sharp drop in activity, which in the second quarter resulted in the loss of around 25 percent of the turnover that large companies and corporate SMEs had a year earlier. As the most severe measures were relaxed, these losses moderated. In June and July, the recovery was strong, but the trend stabilised from August onwards, and only from November onwards were new improvements observed, although these were insufficient to achieve positive rates.

Looking at gross income by type, income tax revenue increased by 0.5 percent, a rate that stands out as positive for the main types. The reason for this behaviour in such an unfavourable context is the compensating role of public salaries and pensions, which have seen high growth throughout the year, and, to a lesser extent, the gross annual tax return and investment fund withholdings. In the rest of the income (withholdings from work in the private sector, fractional payments from personal companies, withholdings from income from movable capital and from leases) the decrease was a reflection of the general situation.

Corporate tax revenues fell by 16.5 percent. The main component of the tax, installment payments, fell by nearly 25 percent, in line with the decline in profits and bases. This significant drop was partly offset by the existence of extraordinary income and by the more moderate decline in most of the other components, especially the gross annual declaration result (-1.2 percent).

In the Non-Resident Income Tax, revenues also registered a fall, in this case by 27.5 percent, mainly due to the negative results in capital gains.

Gross VAT revenues decreased by 9.4 percent, in line with the evolution of sales and inflation. Significant declines were recorded in the revenues of large companies and imports (-10.1%) and SMEs (-8.1%), including revenues from deferrals, which were particularly high this year as a result of measures aimed at facilitating compliance with tax obligations by taxpayers, especially SMEs).

In Special Taxes, revenues were 11.6 percent lower than those recorded in 2019. Tax collection fell across all categories, but the most significant drop in the three most significant categories was in the Hydrocarbon Tax (-14.9 percent). Its trajectory was parallel to that of activity and consumption, accentuated in the last part of the year by limitations on mobility. In the Electricity Tax, which is linked to the same variables, revenues decreased, but with less intensity (-10.1 percent) as it was less affected by some of the restrictive measures. The decline in revenues for the Tobacco Tax was not a novelty (it is the fourth year in which this has occurred), although it occurred at a faster rate (-3.2 percent) than in previous years.

Finally, gross revenue from Chapter III of Fees and other income fell by 18.8 percent. In the case of rates, the fall was 16 percent and was due to lower revenues from the fee for the use of continental waters for the production of electric energy, which is settled with a one-year delay.

Table No. 12. Total gross tax collection l New window (Annex).