The President of the Junta (Autonomous Regional Government) of Andalucía, Juan Manuel Moreno, announced on 20th September 2022 a series of tax measures for Andalucía, with the aim of attracting new taxpayers and investment into the Region.

One of the key announcements is the decision to eliminate wealth tax in Andalucía with immediate effect.


In Spain, wealth tax is a State tax but is fully devolved to the 17 Autonomous Regions (Comunidades Autónomas) of Spain, with each Region having the authority to set their own wealth tax rates, allowances and reductions.

Wealth tax in Spain was suspended in all 17 Autonomous Regions in 2008 and reintroduced from 2012, supposedly on a temporary basis, as a result of the financial crisis. Wealth tax was then extended each year until 2021 when it was reintroduced permanently.

When wealth tax was suspended in all regions in 2008, this was achieved by introducing a wealth tax credit of 100%, which effectively reduced any wealth tax payable to zero, although reporting was still required where the total value of a taxpayer's assets exceeded €2m.

The conservative-led Autonomous Community of Madrid was the only region that continued to apply the 100% tax credit after 2012, and which remains in force today. This means that anyone living in the region of Madrid does not pay wealth tax, although the reporting requirement still exists for those with total wealth over €2m.

Wealth Tax Basics

Residents of Spain pay wealth tax on the value of their worldwide assets and non-residents of Spain pay wealth tax on the value of their Spanish assets. Certain exemptions, reliefs and allowances exist. Under State rules, individuals are entitled to a personal allowance of €700,000 and a further allowance of up to €300,000 to offset against the value of their main home.

The State wealth tax rates are progressive and range from 0.2% to 3.5%; the highest rate applies where taxable wealth exceeds €10,695,996.

The allowances, rates, reliefs and deductions may be varied by each Autonomous Community and therefore significant differences can and do exist between the Regions.

What has Changed in Andalucía?

Wealth Tax

Before the reforms were announced, the progressive wealth tax rates in Andalucía ranged from 0.2% up to 2.5% where taxable wealth exceeded €10,696,000.

Effective from the 2022 tax year, Andalucía has reintroduced the 100% tax credit for wealth tax, effectively abolishing wealth tax in that Community. The credit applies to wealth tax assessments from 31st December 2022, which means that taxpayers resident in Andalucía will have no further wealth tax liabilities.

Note that a wealth tax return will still need to be submitted where the value of an individual's worldwide assets exceeds €2m (or for non-Spanish residents, where taxable assets situated in Andalucía exceed that level).

Income Tax

With effect from 1st January 2022, income tax liabilities have also been reduced in Andalucía for taxpayers whose income falls within the first three tax bands, and personal and family income tax allowances have been increased.

These measures are intended to attract more taxpayers into Andalucía not only from other Regions in Spain but also from overseas.

Originally published 22nd September 2022

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