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Regulatory developments 2021

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Main tax changes introduced by RD-Law 20/2021, of 5 October, adopting urgent measures to repair the damage caused by the volcanic eruptions and for the economic and social reconstruction of the island of La Palma.

PERSONAL INCOME TAX

Exemption from aid for personal injuries

Paragraph 7 in Article 25 of Royal Decree-Law 20/2021 grants the exemption from Personal Income Tax to the exceptional aids for personal damages to those affected by the volcanic eruptions on the island of La Palma referred to in Article 4.

Reduction of the net income indexes for economic activities in objective estimation

Article 26 of Royal Decree-Law 20/2021 provides that the head of the Ministry of Finance and Public Administration, in view of the reports from the Ministry of Agriculture, Fisheries and Food, may exceptionally authorise the reduction of the net income rates referred to in Order HAC/1155/2020, of 25 November, which develops, for the year 2021, the objective assessment method for Personal Income Tax and the special simplified system of Value Added Tax, for agricultural holdings and activities in which damage has occurred as a direct consequence of the disasters resulting from the volcanic eruptions on the island of La Palma.

Real Decreto-ley 20/2021, de 5 de octubre,

por el que se adoptan medidas urgentes de apoyo para la reparación de los daños ocasionados por las erupciones volcánicas y para la reconstrucción económica y social de la isla de La Palma.