Catalonia is considering a reduction in personal income tax for incomes of up to 33,000 euros

The Generalitat of Catalonia has proposed a modification of the regional personal income tax rate that will reduce it by one point for taxpayers with incomes of less than 33,000 euros per year. Thus, Catalans who are in the first tax brackets will see a decrease to 9.5% of the regional scale rate applied in their income tax return, compared to the current 10.5%.

This novelty in the calculation of taxation has been included in the law accompanying the budgets by the Department of Economy of the autonomous community, according to La Vanguardia and reported by Efe. Therefore, the reform does not yet have the guarantee of being supported by the rest of the groups, with which the text has yet to be negotiated.

If approved, a total of 2.6 million citizens will be able to benefit from the reduction in the regional personal income tax rate in Catalonia. This figure represents changes in taxation for almost three out of every four taxpayers. Specifically, 73% of the total will benefit from this measure.

No impact for the rest of the taxpayers

For the rest of the taxpayers, the measure will have a neutral impact, since the tax increase in other sections would be adjusted slightly (a few tenths) so that those who earn more than 33,000 euros do not have any impact and continue paying the same as until now. .

Another of the measures proposed by the Generalitat consists of reducing the number of personal income tax tax brackets from the current nine to eight. With this change, the aim is for the limits between sections to be greater and thus prevent a salary increase to compensate for the inflation of recent months from causing some taxpayer to end up paying a higher rate than until now.

In the case of a taxpayer with an annual gross income of 24,900 euros, with the changes prepared by the Generalitat, half of these would be taxed at 9.5% on the state scale and the other half, which previously was taxed at 10.5%, according to had determined by the Generalitat, now it will also do so at 9.5%.

Savings per taxpayer of 125 euros.

The estimated savings for this taxpayer would be 125 euros and the reduction compared to the regional section, almost 10%. In this way, Catalan taxpayers with the lowest income will no longer be the ones who pay the most among the common regime communities, and Catalonia will not be placed in the rest of the tax brackets as the community with a higher tax rate.

Although the Generalitat approves this measure in the 2024 budget, the measure would not come into force until the following year, when taxpayers file their income tax return. However, this measure would be in force retroactively on January 1.