The CECA sector entities contributed 2.619 million euros in taxes in 2020, the highest figure recorded in five years, despite the pandemic

The overall tax rate of the CECA sector reached 53% of profits

The specific taxes on financial activity approached 1.000 million euros

The total fiscal contribution of the CECA sector reached 5.013 million euros in 2020, the highest figure recorded in the last five years

Madrid, November 22, 2021 – In a year marked by the health crisis, with a sharp deterioration of economic activity, high market volatility, and historically low-interest rates, the tax contribution of the entities adhering to CECA amounted to 5.013 million euros in 2020. This is stated in a tax study conducted by KPMG Abogados, which considers the sum of taxes borne and taxes collected. It is the highest figure recorded over the five consecutive years in which this report has been prepared.

Once again, the entities associated with CECA: CaixaBank, Kutxabank and Cajasur Banco, Abanca, Unicaja Banco, Ibercaja Banco, Caixa Ontinyent, Colonya Pollença, and Cecabank^[1] have made public the data regarding their tax contribution. Regarding the taxes borne, that is, those that represent a cost for the entities and directly affect their profit and loss account, they totaled 2.619 million euros during the period, compared to 2.610 million euros from the previous year, the highest figure in the last five years.

Regarding the taxes collected, which are the taxes withheld or passed on to third parties in the course of the companies’ activities, they amounted to 2.394 million euros, remaining at similar levels to those of 2019. Thus, for the third consecutive year, the taxes borne exceeded the taxes collected.

One of the most relevant items of the borne taxes is the specific taxes of the financial sector

As for the borne taxes, the Social Security contributions by the entity remain the most significant concept. This figure totaled 990 million euros, in line with that recorded in 2019. On the other hand, net payments for income tax amounted to 347 million euros, compared to 284 million euros from the previous year.

It is worth noting that the unrecoverable VAT and the IDEC (Tax on the Deposits of Credit Entities) continue to represent, as in 2019, a significant tax cost for the entities in the CECA sector, totaling 638 and 161 million euros respectively. These taxes, along with the IAJD (Tax on Documented Legal Acts) from mortgages, which was 163 million euros in 2020, constitute the specific taxes for the financial sector and sum to approximately 1.000 million euros. Once again, they represent one of the most significant items of the borne taxes.

Thus, in 2020, the overall tax rate of the entities adhering to CECA reached 53%. This rate exceeds by 10 percentage points that obtained in 2019 and is also above the rates obtained in the years 2018, 2017, and 2016. However, if we took into account the contributions made by the entities of the CECA sector to the Deposit Guarantee Fund (FGD), 676 million euros, to the Single Resolution Fund (FUR), 252 million euros, and the 11 million euros contributed to the Single Supervisory Mechanism (MUS), the total rate for 2020 would rise to 61%.

Almost half of the collected taxes are from employment

Regarding the collected taxes, the largest amount once again relates to employment. Thus, withholdings on account of personal income tax (IRPF) represent 48% of these taxes, totaling 1.151 million euros compared to 1.188 million euros collected the previous year. In second place are withholdings on income from financial instruments, insurance, and pensions, which amounted to 630 million euros. Collected sales and service taxes were 371 million euros, above the 276 million in 2019. Meanwhile, amounts collected by Social Security from employees amounted to 216 million euros, 23 million more than the previous year.

In 2020, this tax contribution was complemented by other measures promoted by the sector during that same year, such as legal and sectoral moratoriums, the advance of unemployment and pension benefits, or ICO lines. These initiatives highlight the importance of defining public-private collaboration frameworks for the recovery of economic and social welfare.

[1] Given that the study refers to 2020, the incorporated entities are: CaixaBank, Bankia, Kutxabank, and Cajasur Banco, Abanca, Unicaja Banco, Ibercaja Banco, Liberbank, Caixa Ontinyent, Colonya Pollença, and Cecabank.