MADRID – The number of multimillionaires in Spain peaked before the pandemic. Figures from the tax authorities show the extreme growth in the number of super-rich people in Spain. These figures also emphasise the different approach to Madrid as Spain´s tax haven.
Just before the corona pandemic hit the world in 2019, Spain had 701 taxpayers with assets of more than €30million. That represents a significant increase compared to the 608 people the tax authorities counted in 2018.
According to figures provided by the Spanish tax authorities, the number of multimillionaires tripled in 2019 compared to 2011. The Spanish newspaper El País wrote in June this year that there are more and more extremely wealthy people in Spain. Spain currently has more than one million millionaires.
Many taxpayers live outside Madrid
In 2019, two-thirds of the number of multimillionaires did not pay wealth tax. Only 240 of the 701 people with a wealth of more than €30million paid this. This is because most of those who paid tax lived outside of Madrid. And people living in this region are exempt from paying wealth tax.
This wealth tax is levied by the autonomous regions themselves. They are therefore authorised to apply discounts or deductions. The Board of Experts, appointed by the Ministry of Finance, is currently examining the possibility of harmonising taxation rules in order to eliminate major disparities between the autonomous regions. Therefore, the Council plans to present its conclusions to the Ministry at the beginning of 2022.
Madrid tax haven of Spain
As mentioned, the Madrid region is the only region in Spain where it is not necessary to pay wealth tax. Income tax rates in Madrid are also among the lowest in Spain. Madrid is therefore regularly referred to as the tax haven of Spain. Due to the application of various discounts, hundreds of millions of euros are not collected in Madrid, while they are collected in other regions.
It is not surprising, the person with the most wealth lives in Madrid. The multimillionaires in this region had an average wealth of 10.1 million in 2019. A significant increase from 9.4 million in 2018. No other region in Spain comes close to this wealth. However, in second place are the multimillionaires in Galicia with an average wealth of 5.9 million.
The wealth of the multimillionaires in Spain
Nearly 75% of the assets are in movable property, the vast majority of which is in shares and investments. Nearly 20% of the capital is in bricks. Only a few percentages of the assets were put into insurance or in the bank account.
The increase in the number of wealthy people in Spain, despite the different tax rules in Madrid, also led to an increase in tax collection. Compared to 2018, the total wealth tax collected in 2019 increased by 8.5% to a total of more than €1.2billion. With almost half of this amount (€554million), Catalonia contributed the most to the Spanish treasury.