For members


Who in Spain will save €1,000 in 2023 thanks to income tax changes?

Thousands of workers in Spain will save €1,000 more this year due to an adjustment in personal income tax. Find out how and who will benefit.

Who in Spain will save €1,000 in 2023 thanks to income tax changes?
The workers in Spain who will save €1,000 in 2023. Photo: JAIME REINA / AFP

This year, the Ministry of Finance will change the way they calculate the amount of Impuesto de la Renta para las Personas Físicas (IRPF) or personal income tax, you have to pay. 

In total, more than 250,000 workers will benefit from the changes and in some cases, will save more than €1,000 per year.

Who will benefit?

It will mainly benefit those who earn less than €21,000 per year, however, those who earn between €22,000 and €35,200 per year will also be considered.

It also means that those with the lowest salaries will stop paying the same personal income tax as those with only slightly higher salaries.

Why is this happening?

Sources from the Ministry of Finance said: “we are facing a great tax reduction… The proposed changes seek to avoid errors that occur in specific family situations”.

The aim is to put a stop to so-called tax gaps, by recalculating personal income tax charges so that there aren’t such large differences between contribution amounts that are practically the same.

How will it work? 

The reduction will be applied in different situations. For example, for couples, where one of the pair earns less than €1,500 per year or in the cases of single-parent families.

READ ALSO – Single parents in Spain: What benefits and aid are you eligible for?

According to the tax authorities, five percent of workers who are within the income tax bracket between €22,000 and €35,200 will benefit.

For example, up until now, if a married worker with two children earned €22,000 per year, they would be taxed €1,186.14, but if they earnt just one more euro – €22,001 for example, they would be taxed €2,303.22.

But in 2023, the Spanish tax authorities will only charge those who earn €22,001 euros, €1,186.57. That is just 43 cents more, meaning that they will be more than €1,000 better off, specifically, they will have made a saving of €1,116.65 compared with last year. 

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.


Spain to raise minimum wage by 8 percent

Spain's government unveiled Tuesday an 8.0 percent rise in the minimum wage, despite the opposition of employer groups, in a context of high inflation and a key election year.

Spain to raise minimum wage by 8 percent

The announcement by Prime Minister Pedro Sánchez comes just months before municipal polls in various regions and a general election which is due by the year’s end.

“We’re going to approve a new 8.0 percent increase in the minimum wage to reach €1,080” gross across 14 months, Sánchez told the Senate upper house of parliament.

Spain traditionally makes salary payments in 14 monthly payments per year, with the extra paychecks typically paid in July and December.

“We are respecting our commitment” to raise the minimum wage “to 60 percent of the average Spanish salary,” he said.

Split across 12 months, that would equate to a gross payment of €1,260.

Although the unions had been pushing for €1,100 over 14 months, they hailed the announcement.

“There will be some 2.5 million beneficiaries and it will have a greater impact on women, young people, those with temporary contracts or working in agriculture or the service sectors,” tweeted CCOO union boss Unai Sordo.

Talks on raising the minimum wage were boycotted by employers groups on grounds their concerns were not being taken into account.

“Let them just give us the figure and get it over with,” grumbled Antonio Garamendi, head of the CEOE business lobby in remarks to reporters.

The new increase in the minimum wage comes against a backdrop of high inflation, even though price hikes have slowed significantly in recent months.

Inflation stood at 5.8 percent in January, after peaking at 10.8 percent in July, the highest level in 38 years.

The announcement comes ahead of a busy electoral year for Spain with various municipal polls in May and a general election by the year’s end, although no date has yet been set.

Sánchez was quick to flag his government’s efforts to raise the minimum wage since taking office in 2018.

“We have raised it by 36 percent, that’s to say from €735 when we entered government to €1,000 gross over 14 months, and always in the face of staunch opposition from the neo-liberals,” he said.