At its cabinet meeting on Tuesday, the government gave the green light to the implementation of new taxes on digital business and stock market transactions, following similar steps by other European countries.
The agreement reached between Spain’s PSOE and Podemos coalition government included the approval of the two taxes, with which the Administration expects to collect about 2.050 billion euros (1.200 billion euros with the digital tax and 850 million with the financial transactions tax).
In the case of the digital tax, its collection will be postponed until end-2020. The bill approved yesterday is the same as the one proposed by the Sanchez Executive in 2019, but the quarterly settlement will be delayed until end-year.
So just as happened in France, when it was faced with threats of retaliation from the United States, there will be a period in which this tax is applied. At the same time, there is scope to see how negotiations in the international arena develop. In this way, the government will not have to give up applying taxes in the digital sphere.
In Spain, the digital tax will be 3% on the income coming from the sale of data, intermediation and online advertising. This tax will be applicable to all multinational companies with turnover of more than 3 million euros in the domestic market and over 750 million globally.
The Tobin tax of 0.2% will be levied on the purchase of shares issued in Spain by listed companies, with a market capitalisation of over 1 billion euros. Unlisted companies and small and medium-sized enterprises will not be taxed. Neither will IPOs, restructuring operations between companies in the same group, or assets under a repurchase agreements. The person liable for tax is the financial intermediary who transmits or executes the purchase order and must submit an annual tax return.
The Ministry of Finance will publish annually, before December 31, the list of companies subject to the tax every year.
Experts at the Ministry of Finance (Gestha) believe the Government could have overestimated the collection figures from the Google and Tobin taxes, in line with the calculations also made by the European Commission. In this regard, they admit how complicated it is to make these forecasts given Spain’s lack of experience with these two new taxes.
According to Bankinter analysts, the Tobin tax – introduced in France in 2012 – had an impact on the trading volumes of the affected Euronext stocks of -10% / – 15%. A similar effect in Spain would mean a permanent impact of -4.5% / – 6.8% on the Spanish Stock Exchange’s revenue and of -6.2% / – 9.2% on its net attributable profit.
