5. Special Taxes

The revenues from Special Taxes (II.EE.) were 12.1% lower than those recorded in 2019, with collection falling to 18.79 billion, a level equivalent to that of 2011-2012. Revenues fell across all sectors, but the sharpest decline among the three most important sectors was in the Hydrocarbon Tax (-15.8%). Its trajectory was parallel to that of activity and consumption, accentuated in the last part of the year by limitations on mobility. In the Electricity Tax, which is linked to the same variables, revenues decreased, but in a somewhat more moderate way (-10.1%) as it was less affected by some of the restrictive measures. The decline in revenues for the Tobacco Tax was not a novelty (it is the fourth year in which this has occurred), although it occurred at a faster rate (-3.1%) than in previous years. Regulatory changes contributed a marginal amount to revenue.

The fall in consumption of products subject to II.EE. It was general (Table 5.1), in some cases very intense, such as in the case of gasoline and diesel (-14.9%) or in the case of alcohol (-30.6% for the highest alcohol content, -12.1% for beer), a logical consequence of the reduction in internal and external mobility and the closure, to a greater or lesser extent, of the hotel and restaurant industry. There were also losses in tobacco consumption (6% for cigarettes, although, as in previous years, other products rose) and electricity (-5.7%).

The same reasons that explain the behaviour of consumption were those behind the downward trend in fuel and electricity prices. Thus, the average price of gasoline and diesel fell, on average for the year, by 13.7% (21.2% before taxes; Table 9.1) due to weak demand throughout the year, also in the global context (the price of a barrel in euros fell by more than 37%). In electricity, the decrease was 5.5% for the year as a whole (Table 5.7), although increases began to be observed in the last days of the year. In contrast, the poor consumption situation did not generally translate into a drop in prices for other taxes. The average retail price of a pack of cigarettes rose by 0.9%, compared with a slight drop in 2019. The increase occurred in the most expensive varieties, while in the cheapest and other products the price did fall (Table 9.2). In alcoholic beverages, the price increased by 1.2% for those with higher alcohol content (Table 5.2) and by 2.9%, a rate similar to that of 2019, for beer (Table 5.3). The fall in consumption and the significant reduction in the prices of energy products led to a decrease in the value of products subject to II.EE. (before VAT) of 17.4% (Tables 1.3 and 5.1).

There were no regulatory changes in 2020, so the variations in the effective rates (Table 5.1) are due exclusively to the different intensity of the fall in consumption of the different products and, in the case of taxes that are based on value, to the evolution of prices. The first of these elements can be clearly seen in the Tax on Hydrocarbons, where the effective rate for gasoline and diesel fell by 2.8% due to the greater drop recorded in the consumption of products with a higher rate (gasoline).

The Excise Taxes accrued lost 13.3% compared to the level reached in 2019 (Table 5.1). All figures decreased, both due to consumption and, in some cases where the basis is value, due to prices. Almost three quarters of the fall is explained by the Tax on Hydrocarbons (-17%), the most important of all of them, although the most striking decreases were those recorded in the Tax on Alcohol and Derived Beverages (-30.4%) and in the Tax on Coal (-57.5%), in the process of virtual disappearance since the large producers announced the abandonment of this product as a raw material for the generation of electricity.

The Hydrocarbon Tax registered a decrease of 17% (Table 5.5) which contrasts sharply with the increase in 2019 (12.4%), although it must be remembered that this was due only to regulatory changes (regional tariff and RDL 15/2018) and that, without them, the increase was practically reduced to zero. The profile of these revenues throughout the year was a good example of the impact of the restrictions resulting from the fight against the pandemic. From the very beginning, the decline in activity was felt in all its intensity, with lows that reached close to 80% in some products during the months of strict confinement. Subsequently, in the third quarter, negative rates moderated substantially, but mobility restrictions in the final months of the year caused a relapse. The evolution of each of the main products reveals the different degrees to which the different uses were affected: -20.9% in gasoline (linked to consumption), -17.2% in automotive diesel (more related to transport) and +0.8% in subsidized diesel (agricultural and fishing work, and heating). This environment led to a break with the trend towards a greater role for gasoline consumption, a fact that was analysed in detail in last year's report. At the same time, as seen in a previous paragraph, the greater fall in gasoline prices and the small increase observed in the consumption of subsidized diesel fuel meant a drop in the average effective rate of the tax. As can be seen in Chart 5.1, rate reductions of this magnitude have only been observed at other times of crisis such as 2008 or 2012.

The accrued Tobacco Tax fell by 4.2% in 2020 (Table 5.6). The decline was concentrated in cigarettes (-5.4%), while the tax on other products grew by 5.5%. Revenue from these other activities has doubled in the last decade, but they still play a somewhat marginal role in the tax burden, which is dominated by cigarettes. During the year, the tax's behaviour maintained its characteristic irregular pattern, exacerbated by hoarding in anticipation of shortages at certain times of the year (especially at the beginning of the lockdown) and the uncertainty associated with tourist movements on the eve of summer. All of this led to a large increase in revenue in the first quarter and significant losses for the rest of the year. As has been mentioned in the case of hydrocarbons, the exceptional situation also broke the trend of previous years, in this case of stability, with a tax accrued just under 6.6 billion euros (average from 2013 to 2019), based on cigarettes, with declining consumption offset by a slight increase in the rate linked to prices.

In 2020, the accrued Electricity Tax decreased by 9.7% (Table 5.7). Its evolution was similar to that of hydrocarbons, following the rhythm of the restrictions, but always with more moderate falls, even despite the decrease in prices (which in this tax form part of the tax base), due to its greater link with household consumption. The consequence was a contraction of the tax base by 10.9%, 5.7 points from consumption and 5.5 from prices. As a counterweight to these falls. The tax benefited from the lower reductions to which large consumers and certain sectors are entitled, hence the loss in the tax accrued was somewhat lower than that of the taxable base.

In alcohol taxes the fall was very pronounced, especially in the Tax on Alcohol and Derived Beverages (-30.4%; Table 5.2), although in the Beer Tax (-12%; Table 5.3) had never seen such a setback before. Logically, the reasons for these declines are to be found in the capacity limitations in the hospitality and catering industry and in the restrictions on mobility that have been established, to varying degrees, since the first state of alarm began. In both cases, the decline in the second quarter was very sharp (-53.5 and -23.7%, respectively), followed by a recovery that was frustrated at the end of the year.

The Coal Tax evolved independently of the situation experienced in 2020. It was reduced again, this time by 57.5%, so that at the end of 2020 the tax accrued was just over 12.5% of what it was in the years of maximum performance between 2014 and 2018 (35 million in 2020, 271 on average in those years). As already noted in last year's report and in subsequent monthly reports, this figure is destined to play a residual role within the system once the use of coal in electricity generation was abandoned by the largest producers.

revenue from Excise Taxes decreased less than the tax accrued (-12.1 vs. -13.3%) thanks to the positive effect that occurs during periods of falling revenue (the cash figure includes data without a decrease, which is carried over from the previous year, and the last periods of 2020, with negative rates, which are carried over to the cash figure for the following year, are not recorded). Regulatory and management measures provide a few million (24; Table 1.5) that hardly alter the result. These measures are related to the changes made in 2019 (regional tariff on the Hydrocarbon Tax) and to those approved to facilitate the deferred payment of tax debts.