Today, Spain’s Second Deputy Prime Minister and Minister of Labour, Yolanda Díaz, presented a plan to reduce the tax burden on small and medium-sized enterprises (SMEs) by increasing levies on large corporations.
According to Díaz, the current system is unfair: micro-enterprises pay an average of 16.5% in corporate tax, while large companies pay only around 5%.
“It’s an anomaly that those with fewer resources bear a greater tax burden,” the minister stated.
The proposal includes reforming the VAT system so that businesses with an annual turnover below €85,000 would only need to file an annual information return, without having to pay tax in advance for services not yet paid for. According to Díaz, this will support liquidity and simplify business operations.
In addition, the initiative includes measures to combat late payments, reduce bureaucratic red tape, and create a state investment banking structure to finance SMEs. Around €3.5 billion per year from the Next Generation EU funds is planned to support companies with up to 50 employees.
Small business associations welcomed the proposed benefits but are demanding more details. Meanwhile, major business groups and some analysts fear that higher corporate taxes could negatively affect investment and job creation.
According to Díaz, the current system is unfair: micro-enterprises pay an average of 16.5% in corporate tax, while large companies pay only around 5%.
“It’s an anomaly that those with fewer resources bear a greater tax burden,” the minister stated.
The proposal includes reforming the VAT system so that businesses with an annual turnover below €85,000 would only need to file an annual information return, without having to pay tax in advance for services not yet paid for. According to Díaz, this will support liquidity and simplify business operations.
In addition, the initiative includes measures to combat late payments, reduce bureaucratic red tape, and create a state investment banking structure to finance SMEs. Around €3.5 billion per year from the Next Generation EU funds is planned to support companies with up to 50 employees.
Small business associations welcomed the proposed benefits but are demanding more details. Meanwhile, major business groups and some analysts fear that higher corporate taxes could negatively affect investment and job creation.
