If taxes serve as a thermometer for economic activity, Alicante’s story shows steady progress with a modest pace. Employment gains, rising wages, and pension increases continue to attract tax collections across the board. Personal income tax remains strong, while value added tax and, above all, regional taxes like the Property Transfer Tax—paid on the purchase and sale of existing homes—display more modest growth amid slower overall economic momentum.
In the first quarter, residents of Alicante contributed up to 1,316 million euros to the central government and the regional government. This sum, covering the major taxes each administration administers, marks a 12% year-over-year rise from the same period in 2022, illustrating meaningful growth but well below last year’s peak, a pattern seen across many regions. [Attribution: regional financial reports]
The shift is most noticeable in regional taxes. Last year, Valencia’s Tax Office reported a 30.9% jump in the province during the first three months of 2023, driven by the real estate sector and an uptick in inheritance transactions, yet the quarterly increase settled at 5.4%, totaling 224 million euros. [Attribution: Valencia Tax Office]
In the event of data breakdowns, the main income streams for Alicante under the regional umbrella continue to be the Inheritance Tax and Real Estate Transfer Tax. The latter reached 156 million euros, an 8.9% rise, compared with a 40% increase for the entire year 2022; the quarterly trajectory suggests a steady but tempered growth. [Attribution: Consel·l Generalitat]
Tax figures also show a softer impulse in other items—Documented Legal Actions dropped by 7% versus 11% a year earlier, totaling 28.3 million in the quarter. The biggest swing reflects Inheritance Tax, where the pandemic-driven death toll had once pushed revenues upward; this year, inheritance receipts declined by 18.3% after a 12.9% rise in the previous year. [Attribution: regional tax office]
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Regarding the remaining regional taxes overseen by the regional authority, Sonia Diaz notes notable gains in taxes tied to land-based gaming. The gambling sector still bears the imprint of pandemic-era restrictions: casino collections nearly doubled to 1.7 million; bingo rose 35% to 2.1 million. The growth is more restrained for slot machines, with a 3.2% uptick bringing rods healed to 9.7 million. [Attribution: regional gaming authority]
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Turning to state taxes, the Tax Administration reports a softer expansion amid a still-weakening growth backdrop. The agency collected 1,092 million euros in Alicante during the first quarter, up 13.9% from the previous year but a touch slower than the 19% rise seen to close 2022. [Attribution: state tax authority]
Within this mix, Personal Income Tax stands out with 451 million euros in revenue, up 16.3%. The Tax Office attributes this improvement to payroll and pension withholdings driven by stronger employment and wage growth, with roughly 27,000 more workers than a year ago contributing to higher take-home pay. [Attribution: tax collection report]
Non-Resident Income Tax also grows, reaching 33.7 million euros, reflecting income from non-residents’ activities or assets in Spain. [Attribution: monthly collection report]
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On the other hand, VAT collection rose at a more moderate pace. January through March saw VAT receipts totaling 540.7 million euros, only a 6.3% increase from last year’s pace. This hints at ongoing consumption but with less exuberance than before. A notable 11% drop in VAT on imports suggests softer supply conditions as job prospects remain uneven. Corporate tax reached 19.4 million, with external traffic about 20.3 million (up 5.3%), and Special Consumption Taxes at 9.2 million, up 5.1%. [Attribution: Generalitat financial brief]