MADRID – More than 90% of Spaniards think there is too much tax fraud. Moreover, a large majority believes that the government is doing too little to combat this.
This is the conclusion of a study by the Spanish Centre for Sociological Research CSIC into citizens’ views on tax fraud. However, the results are somewhat paradoxical here and there.
Spain is the country with the largest shadow economy in Europe. At the beginning of this year, the Spanish tax authorities estimated the size of this hidden economy at 20% of the gross national product. This amounts to about €240 billion. Compare this with France and Germany where the percentage is ‘only’ 12% and 11% respectively.
Too much tax fraud
About 90.3% think that there is ‘very much’ or ‘quite a lot’ tax evasion. This impression is so entrenched that 67% of those surveyed agree that ‘when people stop scamming the tax authorities, it’s only because they’re afraid of being audited’. Exactly 50% also endorse the statement that ‘almost everyone does something about tax evasion and that the government is already taking this into account’. Only 6.6% believe there is only ‘little’ or ‘very little’ fraud.
Only others commit fraud
However, when the Spaniard is asked about his own payment behaviour with regard to taxes, we see a completely different picture. Paradoxically, 93% consider themselves to be well-behaved and responsible with regard to tax payments. In other words: it is the neighbours who commit fraud.
Disappointing government efforts
More than 59% believe that the government is doing little or not enough against tax fraud. This percentage is only slightly lower than the 61% of a year ago. Consequently, this shows the Spaniards see no significant results in the anti-fraud plans of Pedro Sanchez´s government.
Lots of taxes
The proportion of Spaniards who think they pay too much tax has fallen by 5% compared to last year. However, it still sits at 41%. Slightly more, 46.5%, think they pay ‘normally’ and 9.6% think they pay little. This is against the background that the government has announced tax reforms that threaten to entail tax increases for higher incomes. The argument for this is that “there is no social justice if there is no tax justice”. Fair and progressive taxes are essential for maintaining public services. There will also be new taxes for banks and energy companies to compensate for the enormous consequences of inflation.
Benefit from tax money
Despite the fact that 59.4% believe that “taxes are necessary for the state to continue to provide public services”, a majority also believe that these resources are not being used effectively. In fact, 55.7% believe that tax has little or no benefit to the community. Moreover, this is much more than the 41.2% who think they can benefit from it.
Dissatisfaction with the distribution of tax money
Of those surveyed;
- 71.7% believe that very little tax money goes to health care
- 66.3% say that too little goes to housing
- 57.1% to education
- 55.2% to justice
Despite that, and again very contradictory, 55.3% think that health care is sufficient, 49.4% that education is in order and 49% that social services are good.
How to collect tax
As far as the system of tax collection is concerned, the Spaniards make no secret of the fact that they prefer direct taxes to indirect taxes. 64.8% believe that taxes should be collected primarily through income tax. A levy based on the income or assets of individuals and companies. This is in contrast to the 23.5% who prefer indirect taxes, such as VAT. They are levied on consumer goods and services.
