Tax authorities in Malaga collect record-breaking amount for third consecutive year, a whopping 4.68 billion euros
Data special

Tax authorities in Malaga collect record-breaking amount for third consecutive year, a whopping 4.68 billion euros

State tax revenue in the province increased by 5.5% in 2023 due to a boost in employment, wages and price rises

Thursday, 28 March 2024, 12:59


Tax authorities have collected a whopping 4.68 billion euros from Malaga at the end of 2023, a record-breaking amount for the Andalucían province.

It is a 5.5% increase on the 4.439 billion collected from Malaga province in 2022. It is a slightly lower increase than that recorded in Spain as a whole, which was 6.4%, to almost 272 billion euros from almost 255.5 a year earlier. Meanwhile, the amount paid by Andalusians in taxes increased by 7.1% year-on-year, to almost 19 billion euros from 17.666 billion euros a year earlier.

But the rate of increase in tax revenue is slowing down: in 2022 the rise was 17.3% in Malaga province and 14.4% nationally. In 2021, the Malaga Tax Office saw its revenue increase by 22.3%, although it should be considered this was the year after the Covid-19 pandemic, when taxes dropped due to the decline in economic activity. The reduction in the rate of tax growth recorded last year took place due to a "progressive moderation of economic activity", according to the tax agency.

Personal income tax, the tax with the highest contribution

The tax that contributed most to the public coffers in Malaga province was the personal income tax (IRPF), the figures show. Last year it accounted for 44.24% of the tax agency's total income from state taxes in the province. Malaga residents paid 2.073 billion euros for this tax in 2023 - 9.7% more than a year earlier. In Spain, income tax revenue increased by 9.9% in 2023 to 120.28 billion euros, 44% of the revenue from state taxes. Meanwhile, in Andalucía, contributions from personal income tax accounts for more than half, 52.6%, of all regional revenue, at almost 10 billion euros in 2023 - 7% more than a year earlier.

In all regions there was an increase in income tax revenue. The tax agency's officers attribute this to the increase in employment, wage rises and the increase in pensions, which in turn led to a rise in the effective rate. But the increase in the collection of this tax is also due to the fact that withholdings on income from movable capital - savings income - increased by 26.7%.

The non-resident income tax, which is the tax levied on profits obtained on Malaga soil by individuals and entities not based in Spain, recorded a significant increase, according to the data. This tax brought in 219.5 million euros in the province, 18.4% more than a year earlier, more than double the increase recorded in Spain as a whole, where it rose by 8.9% to 3.217 billion.

The other major tax is IVA (Spain's sales tax): in 2023 it contributed 1.666 billion euros - 35% of the Malaga delegation's revenue - an 8.8% increase compared to the previous year. This is a much larger increase than that recorded in Spain (1.6%, up to 83.909 billion euros, 30% of the tax agency's total revenue in the country). In Andalucía, IVA revenue rose by 8.9% to 5.197 billion. Based on the figures, it seems the reductions in this tax on basic food products and energy had a greater impact at national level than in Malaga or Andalucía.

The improvement in IVA revenue was mirrored in the collection of excise duties - much less important in terms of total revenue in Malaga province - which grew by 32.1% to 42.2 million euros. In Spain as a whole, growth was limited to 2.6%, to 20,757 million euros. According to the tax agency, the implementation of the tax on non-reusable plastic packaging, new in 2023, contributed to the increase in collection, while the high price of petrol and diesel had a negative impact.

Corporate profit tax falls again

After personal income tax and IVA, the third highest revenue-earner was corporate income tax. But it was the only one of the important taxes that reduced its revenue, and it did so for the second year in a row. In fact, the 580.8 million euros collected by this tax in Malaga province represented a decrease of 15.8% compared to a year earlier, when it amounted to almost 690 million euros. On the other hand, in Spain, corporate income increased by 9% to more than 35 billion euros, due, according to tax officials, to the increase in corporate profits of 15% last year, in addition to the implementation of the minimum rate of 15%, as well as other regulatory changes.

In any case, the collection of this tax was negatively affected by something that had a greater impact in Malaga: the existence of a large volume of refund requests from the year 2021 and the advancement in the calendar of refunds for the 2022 campaign. Although gross income from corporate tax grew by 33.4% in the province, to 1.082 billion euros, the refunds the Malaga branch of the tax agency had to make exceeded 500 million, compared to 122 million a year earlier. In Andalucía, corporate tax revenues rose by 4.6% to 2.631 billion euros, despite the fact that refunds practically doubled, from 450 to 841 million euros.

The other, albeit less important, tax that saw a drop in revenue in Malaga was the foreign traffic tax, which fell by almost 40% to 16.3 million euros.

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