Taxes keep the country functioning by all of us making a contribution to the national pot in order to provide the services and protection we need. Yeah right, but who enjoys paying them?
It is the obligation of all of us to pay taxes, but never too much of course! I am no economist, in fact unless I use my calculator 2+2 always equals 5, but we all know that Spain and our homelands are in the financial mire along with most of the rest of the world. This means that those who are paying taxes are being squeezed just that little bit more; the reintroduction of the wealth tax is just such an example, not that this is likely to affect me any time soon
Spain is highly bureaucratic as well all know. The number of bruises on my forehead is testament to the amount of wall banging that I do during my daily sword fence with the functionaries. Having too many civil servants is a drain on the public purse, but it could be argued that at least the state is providing employment. The problem is that they are self justifying and totally controlled by government whims.
Import tax
What has this to do with motoring Graham? Well let’s take a look at import tax. This tax is properly known as matriculation (registration) tax and latterly referred to as emissions tax; it is a tax levied on all vehicles at first registration. Whilst the majority of vehicles are new, it is also levied on vehicles being bought into Spain from abroad. This is why some people pay this tax when their car is re-registered. Exemption from the tax is given only to foreigners (this means us) who bring their vehicles with them from their homeland and re-register within a strict timescale, so we are favoured over the natives
Over the past few, the tax has been calculated not only on the vehicle value, but also upon the emissions. In essence the higher the emissions, the higher the tax with some smaller vehicles, being exempt altogether
Re-registration is very complex due to the amount of variables involved and it is vital to know what is needed and when in order to gain exemption from import tax. However even when you know the rules there are many traps along the way such as a piece of paper being not quite right, a problem with the vehicle which slows up the process etc. Until now in almost every case, so long as certain documents were presented to the Hacienda (those demons whose role it is to gather our hard-earned cash) they would accept a delay. To a degree this can still happen, but oh boy is it being clamped down upon. With some of the cash grabbing jobsworths, if a piece of paper is not to their liking, they ask for a further copy or something else completely out of the blue. They never explain that once you have provided one piece of paper that another is required later. These tactics delay the process in the hope of increasing their revenue and at the same time justifying their existence.
I have just experienced what I hope is a one-off from some zealot who refused to accept the market valuation of an uncommon car which has always been the accepted practice; he used a car of similar power and age in order to increase the tax charged. It is hard to keep up without the goalposts being moved and no chance of shifting them back again
Road tax
Road tax is quirky in Spain. It is set by your Town Hall (ayuntamiento) so varies considerably based upon your post code and power of the vehicle. Levied for the calendar year it is normally collected by the first week of May. I am sure that no self-respecting tax gatherer would read this column, so I do wonder why it is so cheap compared to say the UK or particularly in Ireland; seems like they haven’t realised how much more money could be gathered from cars as opposed to just increasing IBI (council tax). Obsessed with making money from property I guess
You are being watched
The government has instructed utility companies such as that wonder of service excellence, Iberdrola, to let them sight all bills so that these can be compared to occupancy during the search for undeclared rental properties (the same old obsession). I have even had customers of mine accused of being resident for some years and therefore liable to pay import tax on their car, despite paying non-residents tax. As the letter from a Costa News reader reported last week, appointing certain types of lawyer to pay your bills and taxes is just a way of making money from unwary expats with no guarantee that the bills will be paid. Shop around or pay suppliers yourself via direct debit. This way if you are out of the country when the payment is due, you have no need to worry about paying extra or in extreme cases having your car impounded to pay of the debt
Working on the black is a national pastime which in the past I indulged in myself and who can blame those that do? I pay a lot per month in contributions and taxes which is a hell of a drain on a small enterprise such as mine, but better this than being caught and paying huge sums in back payments and fines. I sleep at night too (smug git!)
To avoid being caught out or paying over the odds, the use of a seasoned professional is vital whether for vehicle re-registration or any other matters affecting your cash and taxes, or you may pay more than you bargained for. So, take a look at your situation and remember that the buggers are after your money!
Non illigitimus carborundum