In 2024, Catalonia could no longer be the autonomous community that punishes low and medium incomes the most through personal income tax. The Government of the Generalitat is finalizing a tax modification by which the first tax bracket would be cut by one point, going from 10.5% to 9.5%.
The beneficiaries would be citizens with an income of 33,000 euros or less, with which the reform would impact 2.6 million taxpayers, 73% of the total.
This reduction in personal income tax is included in the law accompanying the Budget of the Generalitat for the next year, so its approval and execution depend on the Government led by ERC alone being able to approve the 2024 accounts. It is plausible. let this happen, because both the PSC and Junts have welcomed the proposal of the formation led by Pere Aragonès, which, if it garners the support of the socialists and the post-convergents, would achieve the necessary support for its budget project to go ahead. This would imply, however, breaking the alliance that allowed the approval of the current Catalan budgets, which came to light with the votes in favor of ERC, the PSC and the commons.
The intention of the Ministry of Economy of the Generalitat is that, although the accounts are not approved for the beginning of the year, the reduction in personal income tax will be applied retroactively from January 1.
With the change, Catalonia would adapt to the type of taxation of the majority of autonomous communities with a common regime. Others such as Asturias or the Valencian Community, which continue to be set at 10%, would be taxed more on the first tranche of personal income tax, half a point more than the Generalitat’s proposal.
With 9.5% there are many others: this is the case of Aragon, the Balearic Islands, Cantabria, Castilla y León, Castilla-La Mancha, Murcia or Andalusia. While the Canary Islands, Galicia, La Rioja have a rate of 9%. The lowest tax pressure corresponds to Madrid, with 8.5%, and Extremadura, with 8%.
To prevent the measure from impacting the rest of Catalan taxpayers, the Generalitat would adjust taxation upwards in other sections so that they continue paying the same as until now.
Another of the measures proposed by the Generalitat is to reduce the number of personal income tax tax brackets, from nine to eight. In this way, it is intended that the borders between sections be greater and that, thus, possible salary increases to compensate for the rise in inflation do not have a negative impact on the taxpayer, who could have to pay a higher rate than until now to see an improvement. your income.
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%.
The estimated savings for this taxpayer would be 125 euros and the reduction compared to the regional section, almost 10%.