The Spanish Government has approved an important project. Reduction in Personal Income Tax (IRPF) effective in 2023. This reduction has been applied to the minimum tax bracket; This is one of the workers whose annual income is between 14,000 € and 21,000 €. Salary increase thanks to changes in withholding applicable personal work.
Before these new ones are approved General budgets of the statebeneficiaries, tax breaks They were the ones who were paid between 15,000 and 18,000 euros. However, with the new measure, This discount has been extended to all taxpayers with a gross annual salary of between 15,000 and 21,000 euros.. It is estimated that this discount will benefit half of the wage earners in the country.
Changed the amount of discount applied to net income from business. For those whose net income from work is less than or equal to 14,047.50 euros, the applicable discount increases to 6,498 euros. Previously, this amount was 5,565 euros. On the other hand, if the net income from the business is between EUR 14,047.50 and EUR 19,747.50, the applicable deduction is obtained from the following calculation: EUR 6,498 minus the difference between the income from the business and EUR 14,047.50 multiplied by 1.14. The multiplier used before the new changes was 1.5.
Do I have to do this?
It is worth emphasizing that To take advantage of this new measure, the worker must not take any action. because it is the responsibility of the company you work for to update the tax status. This new rule took effect in February, although retroactively from January.. If the worker does not observe this change in his payroll, he must notify his employer to comply with this new measure.
This reduction personal income tax This is great news for Spanish workers, because they will benefit from an increase in their net salary. Also, this measure can have a positive effect on domestic consumption as workers will have more purchasing power. On the other hand, it can have a positive effect on the country’s economy as it can increase tax collection by encouraging consumption and economic activity.