Spain: Tax measures in 2023 budget law

The 2023 budget law includes numerous direct and indirect tax measures.

The 2023 budget law includes numerous direct and indirect tax measures.

The 2023 General State Budget Law 31/2022 (dated 23 December 2022 and published in the official gazette on 24 December 2022) includes numerous direct and indirect tax measures, the most significant of which concern value added tax (VAT), corporate income tax, and individual (personal) income tax.


  • The so-called effective use rule, or effective use clause, on the place of supply of certain services was modified.
  • Certain aspects of the recovery of VAT on bad debts were amended.
  • The scenarios in which the reverse charge mechanism applies were changed.
  • Certain changes regarding the application of VAT to electronic commerce were introduced.
  • Reduced VAT rates for feminine hygiene products, contraceptives and other non-medicinal contraceptives, as well as for certain food products, were enacted, and reduced VAT rates on energy were extended.

Corporate income tax

  • The tax rate for very small companies was reduced.
  • Accelerated depreciation for investments in certain new electric vehicles was introduced.

Individual (personal) income tax

  • A new tax bracket for savings income was created.
  • The minimum threshold for exemption from the obligation to file tax returns was increased, and a reduction was provided for net earned income.
  • Changes to the objective assessment (modules) and simplified direct assessment regimes were introduced.
  • Certain technical improvements to the regulation of the cap on the reduction of taxable income for contributions to pension schemes were made.
  • The maternity tax credit was extended.
  • The withholding tax rate on intellectual property income and royalty advances was established.

Other recently enacted tax measures

Other tax measures were enacted by various laws adopted in the final days of 2022 that will, in many cases, become effective in 2023:

  • Law 38/2022 (dated 27 December 2022) established new special levies on financial institutions (read a December 2022 report [PDF 525 KB] prepared by the KPMG member firm in Spain) and energy companies (read a December 2022 report (Spanish) [PDF 509 KB] prepared by the KPMG member firm in Spain). The law also introduced a new temporary solidarity tax on large fortunes and amended the wealth tax for non-residents who are indirect owners of property in Spain (read a December 2022 report (Spanish) [PDF 574 KB] prepared by the KPMG member firm in Spain). In addition, the law included a temporary limitation on the offset of losses in the context of tax consolidation and amended the applicability of tax credits to film production and the related financing.

  • Royal Decree-Law 20/2022 (published in the official gazette on 28 December 2022) introduced various measures concerning tax, employment, social security, housing and eviction that seek to establish a regulatory framework to curb escalating prices and support the most heavily affected citizens and companies in the following areas: energy, food, transport, gas-intensive industry, economic and financial stability and the “social shield” (read a January 2023 report (Spanish) [PDF 534 KB] prepared by the KPMG member firm in Spain). The law also extended the so-called “corporate moratorium” until the end of 2024.

Read a January 2023 report [PDF 662 KB] prepared by the KPMG member firm in Spain


The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 3712, 1801 K Street NW, Washington, DC 20006.