As in any other country in the world, the collection of taxes in Spain is absolutely necessary to maintain public finances. The contribution of citizens allows their redistribution in an equitable manner or their investment in specific needs. Among these are: infrastructure, health, education, social security, and territorial defense.

There are three types of taxes: taxes, voluntary contributions, and fees. The tax system is responsible for preparing the necessary regulations for the payment of taxes. Voluntary contributions are often used by large legal entities to smooth out the amount of their taxes.

The fees are payments, made almost always by consumers, taxed by the processing of a specific commercial activity. That is the purchase, sale, transfer, and distribution of a specific product or service. They are very common in international trade, for example, when making an import.

Characteristics of the Spanish tax system

Spain has one of the most efficient and modern tax collection systems in the world. According to the Eurostat report (2018), in its report “Taxation Trends in the European Union “, the fiscal pressure in Spain is almost five points below the average of the countries of the European Union (27).

The tax burden is the percentage of taxes and social security on the GDP; it is usually an important financial indicator. The growth of an economy depends on the fact that people and businesses are not drowned by the taxes necessary for their well-being. It is a delicate balance, in constant revision.

Types of taxes in Spain

Direct: those applied on a regular basis to individuals or legal entities on their assets or capital income.

Indirect: payment added to the service or consumption.

Progressive: applied according to a percentage proportional to the growth of a base of goods or capital.

Regressive: applied inversely proportional to the growth of the base.

The main direct taxes applicable in Spain are Corporation Tax (IS), Personal Income Tax (IRPF) and Non-Resident Income Tax (IRNR). The most important indirect taxes are the Value Added Tax (VAT) and the Tax on Capital Transfer and Documented Legal Acts (ITP and AJD).

The tribute of online games, a portentous entrance

The money paid as a result of betting and games online is considered as an equity increase. Consequently, they must be reflected in the corresponding Income Tax Return. Generally, it is declared and paid the following year, as long as certain minimum conditions are met.

According to the portal, the first condition is that the net profit obtained in the total sum of gambling and betting profits, other activities and the performance of bank accounts is greater than 1,600 Euros. When the annual increase exceeds this figure and the taxpayer does not declare it, the Treasury may open a procedure for tax fraud.

If the amount does not exceed the line of one thousand six hundred euros, it is not necessary to declare and, in case of doing so, the Treasury will not retain anything. The previous statement does not apply when the net increase derives from work activity. In this case, it applies from profits higher than one thousand Euros as long as the income from work exceeds 22,000 Euros per year.

Taxes on casinos

The newest casino operators already know in advance that charges should be recorded for their activities based on their geographical location and tables in operation. This tax must be paid during the first five days of the following month.

In Spain, this is a controversial issue, as some autonomous communities demand tax tightening on casinos. They argue that it is a vice with the potential power to destroy families and damage the social environment of a region.

On the other hand, most economists point out that blaming casinos for problems like gambling is absurd. The argument is that this type of affections obeys more to psychosocial tendencies of each individual and each community. In addition, the economic contribution of gambling establishments and online betting sites is increasingly significant.

According to the Ministry of Finance of Spain, internet bets increased by 27% during 2018. Only in the last quarter of 2018, the net profit margin increased to 40% with respect to the previous year. The more than 167.2 million Euros spent during this period reveal an unstoppable growth of the sector.

The trend is international thanks to sports, especially football

The solution to the regulations of the game has always been a sensitive issue in Europe. The massification of sport (especially in the main football leagues), requires paying more attention to the type of transactions carried out. In this way, states can benefit from the growth of online games and also protect their consumers.

In Spain, the Professional Football League has copied the strategy of the Premier League of England which consists of conquering the Asian market. Platforms like, show in their statistics the economic benefit that it represents for all the countries involved, both issuers and recipients.

Consequences of the expansion towards the Asian market

The main professional football leagues in Europe report brutal income from the sale of their television rights. This drives the growth of clubs, therefore, improves the quality of life of people and companies linked to sport.

The huge audience represented in the Asian demographic density is also the object of desire for other sports such as the NBA and the NFL. So, what is the problem, if there is one? Simple: sports betting has always been linked to fraud and corruption scandals.

What is the solution? It is also simple: adapt to new times and monitor the transparency of online transactions. Technology has also been key for aspects such as video arbitration, or systems such as Hawkeye. With these innovations, both the spectators and the athletes have less suspicion regarding the legitimacy of the referees.

Regulations in any economic sector, including casinos and online games, should not point towards taxes. The objective is to guarantee the transparency of the circulation of capital. It is absurd to restrict the growth of a sector based on tax strangulation. In the end, all sectors of the economy and society can benefit.

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