3.1. Gross tax collection

The gross amount of tax collected comprises the effective incomes obtained in the fiscal year from both the self-assessment tax returns filed by taxpayers and from the settlements carried out by the Tax Agency. It is therefore set on a cash basis.

The total gross revenue managed by the Tax Agency in 2022 reached 320,687 million euros, which represented a year-on-year increase of 16.3% (45,085 million more than in 2021).

The increase in gross income in 2022 is mainly explained by the growth in consumer spending, wages and pensions, and business profits, with the additional contribution of positive contributions from the annual income tax and corporate tax returns corresponding to the 2021 financial year.

Part of the high growth in 2022 of the main tax bases (consumer spending, household income and profits) is related to price increases, but these are not the main cause. It is estimated that just under 5 points of the increase in revenue is due to price increases above their evolution in recent years, despite the fact that the CPI (the usual reference, although not necessarily the most appropriate when it comes to tax collection) grew, on average for the year, by 8.4%. In this sense, it must be taken into account that the CPI only directly affects a part of VAT revenues which, in gross terms, grew more than twice as much as prices. In addition, the rise in electricity prices was partially offset by the rate cut. In other cases, such as salaries and pensions, the increases are not linked to the prices of the current year, but rather, for the most part, to those of the previous year. Finally, in other figures that revolve around physical consumption, such as the Tax on Hydrocarbons, the effect of prices on income is negative.

Indeed, one of the features that characterized the year 2022 in terms of the economic environment was the high inflation that occurred at the same time as the intense growth of activity was maintained, especially until the last third of the year. Deflated sales, which had already surpassed 2019 levels by the end of 2021, continued to grow at a good pace until reaching their highest levels in the central months of the year. Both the daily domestic sales provided by the VAT Immediate Information Supply system and the total sales declared monthly by Large Companies and quarterly by SMEs, followed a growing trend until the second quarter to moderate subsequently, especially in the section end of the year. In current terms, the profile was more pronounced because, in general, prices tended to follow a similar trajectory, with increasingly greater increases in the first half and a gradual deceleration in the second (the CPI and the IPRI - Industrial Price Index - with and without energy followed this pattern; (On the other hand, the core CPI, without the most volatile elements, continued to grow until December). Employment also lost momentum as the year progressed, but the slowdown was more gentle.

If gross income is analysed by figure, income tax collection increased by 14%. The main reasons for the growth are the increase in labour income (wages and pensions) and its effective rate, the good results of the 2021 annual declaration submitted at the end of June 2022 and the increase in the profits of personal companies. The first of these is behind the sharp increase (12.5%) in withholdings on income from work and economic activities, the main component of the tax. Both those from the private sector (12.9%, especially in SMEs, which in the first two quarters were still compared to periods affected in 2021 by some type of limitation on activity) and those from the public sector (11.7%, with an increase of close to 18% in those derived from pensions) are increasing. The increase in withholdings was due to the growth in employment (particularly in the private sector), the rise in average wages and pensions (more in the second case than in the first) and the increase in the effective rate that these increases brought with them. As regards the annual declaration, the positive share increased significantly (25.4%) due to the growth of income not fully subject to withholding or payment on account (income from business activities and capital gains), in addition to the effect of regulatory changes (increase in rates on the savings base and modification of the limits on contributions to pension plans) approved in the General State Budget Law for the year 2021. Finally, split payments, mostly linked to the operating results of personal business activities, grew by 21.7% and were 28.5% higher than the revenue recorded for this concept in 2019.

Gross corporate tax revenues rose by 21.7%, mainly reflecting the very favourable performance of profits in both 2022 and 2021. The former were reflected in a sharp increase in split payments (17.3%), which was also widespread by type of company, although particularly high in consolidated groups and, within them, in groups in the banking and energy sectors. The benefits of 2021 can be seen in the considerable growth (41.7%) of the annual return revenues, mostly coming from the 2021 return filed in July 2022.

In the Non-Resident Income Tax, gross income grew by 36.7%. It should be remembered that this tax had not recovered its pre-pandemic levels, mainly due to the adverse performance of capital income. In 2022, however, these incomes have recovered much of their former dynamism and this, together with the best results of the annual declaration, allowed a historical record of income to be reached, close to 3.6 billion euros.

Gross VAT revenue rose by 20.4% and would have done so at a greater rate if it had not been for the lost revenue related to measures on energy consumption in order to compensate for the increase in these costs. In any case, the rates are much higher than the increase in prices in the same period (between November 2021 and October 2022, the months included in the collection, the general CPI rose, on average, by 8.4%), which indicates that the growth was not only a consequence of the rise in prices, but also of the intense recovery in consumption.

Revenue from special taxes performed worse and only rose by 3.1% compared to the figure recorded in 2021. It should be remembered that these taxes were, among the major figures, the only ones that in 2021 failed to recover the level of 2019. They did not achieve this in 2022 either, although if the calculation is made without taking into account the Electricity Tax, which is collected marginally due to the measures to moderate the cost of electricity, then the income is 1% higher than it was three years ago. The reason for such a poor result is the weak performance of the Hydrocarbon Tax, whose revenues increased by only 5.2%, which means that the 2022 revenues were still below the 2019 figure. Growth at the beginning of the year was high compared to periods still affected by mobility restrictions, but, as the comparison was made with months of normal activity, the negative impact on revenue from high gasoline and diesel prices became noticeable, which was coupled in recent months with the moderation of the general economic situation. The situation with the second most important special tax, the Tax on Tobacco Products, was completely different: In 2022, it grew by 9% after five consecutive years of declines. You have to go back to 2016 to find revenue similar to that of 2022. Prices of the main cigarette brands have been increasing since September 2021, as have the prices of the rest of the products, and with greater intensity, but these increases explain only about 5 points of the growth; The rest can be attributed to an increase in consumption. Alcohol taxes increased revenue by 24.9%. The rate is also high in comparison with some periods of the previous year with restrictions, but, even so, the final collection is higher than that which would result from applying an average historical growth to the 2019 data. Finally, it is worth noting the resurgence, however small, of the Coal Tax, which had virtually disappeared in recent years but which saw its revenues almost double in 2022 in the context of uncertainty over energy raw materials.

Finally, gross revenue from Chapter III of Fees and other income reached 2,625 million, which implies a drop of 2.9% compared to 2021. The main reason for the decline was the disappearance of revenue from the Fee for the use of inland waters for the production of electrical energy (as a result of a Supreme Court ruling that led to the return of the amount collected until 2021).

Table No. 12. Total gross tax collection l New window (Annex).