The Government rectifies its plan to “gradually” eliminate the reduction for joint taxation in personal income tax after the harsh criticism received from the opposition on electoral eve and ensures that it will wait for the opinion of the experts on the tax reform and evaluate ” the measure without increasing the tax burden on families”.
The executive had included this measure in the Recovery Plan sent to Brussels on Friday, considering that “it generates a disincentive to the labor participation of the second income earner”, who are usually women. This measure, advanced by El País, was intended to be adopted through the establishment of a transitory regime.
This measure, which entailed the suppression of the tax reduction enjoyed by married couples who file joint returns and which amounts to 3,400 euros, had been requested by AIReF in a report published last summer, in which it linked the tax benefit with inequality between men and women
The reduction in the personal income tax base for joint taxation amounts, in the case of family units made up of both spouses, to 3,400 euros, and in single-parent families, to 2,150 euros. Two million households benefit from this exemption and its cost amounts to around 1,000 million a year.
The Tax Agency expects to receive almost 3.5 million joint returns in the 2020 income campaign, 7.1% less, a downward trend that has been maintained for years since this reduction is applied mainly in the case of that one of the spouses does not work.
The proposal is included in the Recovery Plan that the Executive led by Pedro Sánchez has sent to the European Commission for its approval.
The approach is framed within equality policies, such as .
The tax reduction benefits households in which only one person in the couple is an income recipient. This situation is usually occupied by women, and the approach deepens in discouraging their entry into the world of work.
AIReF recommended the abolition of the tax benefit
A report from the Independent Authority for Fiscal Responsibility (AIReF) already and its pernicious consequences in this regard, and recommended the suppression of the tax benefit.
The joint income statement saves 3,400 euros per year for couples who pay the tax in this way. It is precisely this tax benefit, according to AIReF, that causes negative effects on the job offer of the members of the family unit who contribute a lower income, discouraging their participation in the labor market.
Specifically, according to the analysis of the data from the 2016 joint income tax returns, women are the member of the household in Spain with the lowest income in 83.2% of cases.
At this point, two issues should be highlighted: that the employment rate of women in Spain is below that of neighboring countries and that the gap between the female and male employment rate (18.9%) is higher in Spain than in neighboring countries, especially among married women, and that this worsens up to 30.9% if they have a lower educational level.