Ibex banks will pay 12.552 million in taxes in 2023, up 17.4% from the previous year.

six large Ibex banks paid 12.552 million taxes in 2023 having paid the corporate tax and the emergency bank tax, which is paid in the first three months of the year compared to the previous year and for which they have already paid $1.120 million. Businesses were subject to special taxation, which the government justified as increasing sector profits due to rate hikes by the European Central Bank. Listed banks allocated 11.432 million for payments to Companies at a consolidated level last year, which is 17.4% more than they paid in 2022, when they paid a total of 9.736 million euros, although it must be taken into account that Unicaja was included in the continuous market . In principle, the emergency tax was approved for a period of two years, but the executive branch extended it until 2024. Financial sector forecasts indicate that these companies will have to pay up to $1,493.5 million this year for last year’s “extra” profits. which would mean 30% more.

Among large banks CaixaBank expects to pay more of this tax in 2024.. The company believes it will pay up to 500 million. Banco Santander believes it will have to pay up to 338.5 million, while Sabadell expects to have to pay 190 million and Bankinter estimates it will pay between 90 and 100 million. According to market estimates, Unicaja could pay between 90 and 100 million. In addition to this special tax, rising rates and the resumption of banking activities have increased sector profits as well as taxes paid by businesses. “The payment of these taxes, in addition to other taxes, puts Spanish banks at the top of Europe in terms of their contribution to public coffers. Both in Spain and in the countries in which they operate, banking is one of the sectors that most contributes to the maintenance of the welfare state,” says José Luis Martínez, spokesman for the Spanish Banking Association.

Increase in banking profits (listed banks earned 26.336 million euros, 26.32% more than in 2022) It comes amid high political noise due to criticism from the most radical sectors of government who criticize what they see as excessive profits.. Ione Belarra, secretary general of the Podemos party, which is no longer part of the government although it had ministers during the last legislature, announced that her party will convey to the Minister of Economy, Trade and Business Carlos Bodi a proposal to tighten the emergency tax on banking activities. that 50% of each enterprise’s profits be collected over the next six years.

Enterprises take taxes to court

This tax was developed by the government of Pedro Sánchez in July 2022 with the aim of taxing the extraordinary profits that banks recorded as a result of rate hikes. The financial sector has never shared this view and notes that interest margins have not risen as much as profits., so they challenged this tax in court. “We believe that maintaining this type of special taxation for the banking sector is counterproductive for both the Spanish economy and banking. And a strong financial sector It is important to stimulate growth and the competitiveness of the economy,” explains José Luis Martínez, spokesman for the Spanish Banking Association. Higher interest rates have boosted bank profits, but experts note that their profitability does not cover the sector’s cost of capital. “The profitability of Spanish banks is still lower than many of their peers in Europe,” says Martinez.

The emergency tax is paid in two installments: the first on account, in February, and the second in September.. Each of these payments is made in the amount of half of the full expected payment amount. This way, an advance is issued that can be reviewed later once the companies have approved their final accounts. Adjustments or changes may still be made until then.

Although this emergency tax was introduced on a temporary basis for two years, for 2023 and 2024 (levied at the end of 2022 and 2023, respectively), The government intends to make it permanent.. In an interview with the Prensa Ibérica group last week, new Economy Minister Carlos Bodi said the bank tax had not prevented the sector from achieving record profits.

Since taking office, the Corps has met with various organizations, some of which have asked for changes to the tax to reduce what it considers to be “discriminatory in nature.”. The current configuration excludes businesses that earn less than 800 million euros in interest margins and net fees, which will favor foreign banks operating in Spain, as reported by institutions such as Bankinter, Banco Santander or CaixaBank.

According to the Ministry of Finance, it will collect about 3 billion euros. thanks to emergency bank taxes and energetic. These are preliminary calculations. In the case of banking, this tax is likely to increase, but in the energy sector, it is likely that falling profits in the sector will lead to a decrease in the amount collected under the special tax. Tax collection by banks last year amounted to 1.263 million euros, less than half of the 2.900 million euros collected together with the tax on energy companies.