In which Spanish cities do entrepreneurs pay higher local taxes?

In Spain, the tax burden for entrepreneurs can vary significantly depending on the autonomous community and even the municipality.

A new study, “Panorama of Local Taxation 2024” found that entrepreneurs registered in Madrid pay an average of €566 more in municipal taxes than those living in Pamplona.

What are these taxes?

- Property Tax (IBI): This is paid for both commercial properties and residential homes. It’s the most profitable for municipalities, representing over half of their income.



- Economic Activity Tax (IAE): Imposed on companies and entrepreneurs engaged in commercial, professional, or artistic activities. It is mandatory for organizations with annual revenue exceeding €1 million.



- Mechanical Traction Vehicle Tax (IVTM): A road tax, or vehicle tax, determined by the type, power, and use of the vehicle.



- ax on Construction, Installations, and Works (ICIO): Levied when construction or renovation projects require a permit. It is calculated based on the project's cost and typically ranges up to 4% of the total cost.



- Tax on the Increase in Urban Land Value (IIVTNU): Charged when property is sold, inherited, or donated. The tax is based on the increase in the cadastral value of the land during the period of ownership, not its market value.

On this interactive map, you can explore the tax distribution by amount.