Mojácar Council has approved, in an ordinary plenary meeting, the modification of the Regulatory Fiscal Ordinance on the Tax on the Increase in the Value of Urban Land, which will set the guidelines for the collection of the Capital Gains generated in the municipality.
The local authority agreed to continue applying a tax of only 20%, despite the State authorising municipalities to apply up to 30%, a rate applied in the majority of municipalities to compensate for the decrease in income.
The decision, presented by the authority’s Government team, was put before the council plenary meeting with the approval of the authority’s Treasury department, the Secretary, and the Intervention report which evaluates the economic-financial impact of the modification, as well as the compliance with applicable regulations, and in particular, the principles of budget stability and financial sustainability.
As reported at said plenary meeting, the new regulation includes two calculation formulas: one called the real system and another obtained through a formula called the objective system.
For the calculation of the tax base by the real method, the percentage difference between the value of the acquisition and the transmission value are calculated. With the objective method, a coefficient is applied to the property tax value of the land, which varies according to the number of years over which the increase has been revealed. Said coefficient is updated annually by regulation or legal range.
Once the base has been calculated by both methods, the stipulated tax rate of 20% is applied to the lesser.
With this reduced tax rate, according to the report presented by the Municipal Intervention, and with a tax projection based on the settlements of the last three financial years, it emerges that on recognised rights of 1,200,000 euros, there would be a loss of some 400,000 euros. This transferred to the total of chapter I income means an income loss of 2.87%.
In any case, the Almería Provincial Council is producing a computer program which will calculate both formulas (real and objective), and will automatically apply the most beneficial to the taxpayer.
The modification of the Regulatory Fiscal Ordinance on the Tax on the Increase in the Value of Urban Land will be definitive once the period of exhibition to the public of 30 working days has elapsed, counting from the day following its publication in the Provincial Official Bulletin (provided there are no claims or allegations).
