Economic capacity and its manifestations

Economic capacity is thus established as the preferred criterion of fairness in the distribution of the economic burdens necessary to meet public needs and, therefore, is the main criterion governing the Spanish tax system. economic capacity each citizen is manifested in different ways, either through the wealth they possess, the income they earn, or the different types of consumption they make.

The possession of assets, the obtaining of income, the acquisition of an inheritance or a donation, the purchase of goods are considered to be facts representative of economic capacity, also called " tax capacity ", because, based on it, taxpayers make their tax contributions to the Public Treasury. That is, it is the money that one has, or that is proven to be had judging by the things that a person buys or owns.

Therefore, economic capacity is an indicator of tax capacity, because it shows how much a citizen can and should pay in taxes. Those with greater economic means have greater tax capacity and, therefore, must pay more in taxes, within the limits stipulated to prevent taxes from being so high that they become confiscatory.