TAX REFORM TO BE DETAILED TODAY

 

Last Friday, the spanish government proclaimed a "breakthrough" of the fiscal reform, which, include a reduction of income tax minimum and maximum marginal rates, new family and personal exemptions, a decrease of taxation on savings and reductions in corporation tax.

The first phase of the reform will apply from January  1st 2015 and the second from January 1^st  2016. The project collects cuts on income tax of 12.5% ​​on average,  the taxation of capital income and corporation tax. Savings income taxed from a minimum of 19% and a maximum of 23% and the basic rate of corporation tax from 30% to 28% in 2015 and 25% in 2016 will be reduced. Moreover, it has also announced aid of 1,200 euros to large families and disabled and publication of a list of defaulters to the Treasury to fight the fiscal fraud.

The government has insisted several times that VAT will not be modified, although  in compliance with a European judgment, there will be a reclassify of some medical devices in among which could be found, for example, glasses or contact lenses.

The Prime Minister, Mariano Rajoy, also advanced on Saturday there will be a reduction in the withholding of self-employed , which amount shall now explain the minister, along with a clarify over the future of the taxation system of modules. According to officials of self-employed associations ATA , the modules system will not be deleted, but it will limit the groups that are directly related to the individual, such as trade, hotels and taxis.

The details of the reform are expected to be announced today by Cristobal Montoro, the Tax Office Minister.