The move to cut legacy and donation taxes aims to speed up the process, signaling an early win for the governing coalition ahead of the July elections. It marks one of Carlos Mazón’s priorities after years in opposition. The measure is now advancing under the urgency heading in the Official Journal of the Generalitat Valenciana as the first tangible action of the campaign ahead of the vote.
Last week the DOGV announced the start of a mandatory public consultation period to modify existing law. Specifically, the change targets two articles of Law No. 13/1997, which govern regional taxes and, in particular, the bonuses and conditions applied to Inheritance and Gift taxes. Under regional and national rules, the public input stage must remain open for at least one month unless the action is deemed urgent, which is now the case.
Consequently, the period for public commentary opened by the Consell is shortened to ten working days from the moment the measure is published in the official gazette. The window runs from the previous Friday until August 4, with August 15th considered a holiday and a non-working day. After that window closes, the submitted claims will be reviewed and the text, currently a bill, will be refined. The Ministry of Finance will then bring the proposal to the Consell for plenary approval, after which it must receive consent from the Corts.
The earliest possible enactment would occur in September, when the parliamentary session resumes. Once approved, the measure’s effects are expected to be retrospective as planned: bequests or donations eligible for the bonus as of May 28 will benefit. This aspect was highlighted in the bill, a point emphasized by the PP and Vox after securing a broad electoral majority.
Officials explained that the measure targets taxable events that occurred since May 28, 2023 and is designed to be a fair rule for taxpayers in general. It is noted that the proposal should be deployed promptly to ensure beneficiaries receive relief quickly without increasing the administrative costs of tax collection. In other words, the aim is to refund funds from public coffers without added burden on the administration.
“Difficult” Tribute
The bill also delves into the reasoning behind simplifying these taxes. It notes that the Inheritance Tax historically had limited impact on most citizens, but during the most challenging years of the crisis the bonus was lowered from 99% to 75% with the PP’s ascent to power. Two differing explanations exist for the same policy shifts, from governments with opposing colors, while since 2017 (under Botànic) there has been an effort to maximize revenue by further trimming current reductions.
The document on inheritance tax highlights that, for many families, the tax has caused serious economic harm. It was open to public consultation, stressing that the Inheritance Tax has a relatively minor share of total public revenue and remains a heavy burden for families. Officials estimate the tax contributed under 1% of total revenue, and Generalitat revenue anticipated around 400 million euros from these taxes in 2023.
The draft notes that Valencia currently applies a 50% tax bonus, with higher relief for youths under 21 or individuals with disabilities, for whom the discount can rise to 75%. Under the proposed rules, a 99% exemption would apply to certain inheritances or gifts transmitted to descendants, spouses, or adoptive relatives, with similar benefits extended to donations and other beneficial transfers from a donor to relatives or spouses.