There is much news that has been published lately on this subject. As well as many judicial pronouncements existing today overcome by the last sentences dictated by the Constitutional Court, which have declared null and unconstitutional precepts 107, 1 and 2, and 110, 4 of the TRLHL, expelling them from the legal system.
The two disputed questions about this tax have been: a) the realization or not of the taxable event when there is no increase in value, and b) the quantification of the tax base, on the formula that the current legislation establishes to fix the increase that is taxed with the tax.
The method of calculating the tax rate of this tax has always been questioned, as it is a system that contradicts the constitutional principle of economic capacity, as evidenced by the innumerable judicial appeals filed before Courts and Tribunals.
Therefore, in response to the judgments of the Constitutional Court, the Superior Courts and Tribunals of Justice are analyzing and reviewing their previous proposals in that sense and are dictating the resolutions derived from previously initiated proceedings in which the collection for damages is being rejected. City councils, for nullity of application of said precepts and also, when the calculation error of the tax generation period is proven.
Today, it is not possible to assume that there is a taxable event based on a valuation procedure based on objective and presumable criteria.
The Government's draft
As a consequence of the foregoing, and in order to promptly respond to the mandate of the Constitutional Court to carry out the relevant modifications in the legal regime of the tax, the Government, which has met with the Spanish Federation of Municipalities, has prepared a preliminary draft of the ITU that modifies the TRLHL, introducing a new case of non-subjection for cases in which the taxpayer certifies that he has not obtained an increase in value, for which the City Councils will be authorized to carry out the corresponding checks.
In addition, in order to technically improve the determination of the tax base, it is foreseen to replace the applicable annual percentages on the value of the land for the determination of the taxable base of the tax by the maximum coefficients established based on the number of years elapsed since the acquisition of the land, which will be updated annually, according to the evolution of the real estate market and the cadastral value coefficients of the Real Estate Cadastre Law.
The two disputed questions about this tax have been: a) the realization or not of the taxable event when there is no increase in value, and b) the quantification of the tax base, on the formula that the current legislation establishes to fix the increase that is taxed with the tax.
The method of calculating the tax rate of this tax has always been questioned, as it is a system that contradicts the constitutional principle of economic capacity, as evidenced by the innumerable judicial appeals filed before Courts and Tribunals.
Therefore, in response to the judgments of the Constitutional Court, the Superior Courts and Tribunals of Justice are analyzing and reviewing their previous proposals in that sense and are dictating the resolutions derived from previously initiated proceedings in which the collection for damages is being rejected. City councils, for nullity of application of said precepts and also, when the calculation error of the tax generation period is proven.
Today, it is not possible to assume that there is a taxable event based on a valuation procedure based on objective and presumable criteria.
The Government's draft
As a consequence of the foregoing, and in order to promptly respond to the mandate of the Constitutional Court to carry out the relevant modifications in the legal regime of the tax, the Government, which has met with the Spanish Federation of Municipalities, has prepared a preliminary draft of the ITU that modifies the TRLHL, introducing a new case of non-subjection for cases in which the taxpayer certifies that he has not obtained an increase in value, for which the City Councils will be authorized to carry out the corresponding checks.
In addition, in order to technically improve the determination of the tax base, it is foreseen to replace the applicable annual percentages on the value of the land for the determination of the taxable base of the tax by the maximum coefficients established based on the number of years elapsed since the acquisition of the land, which will be updated annually, according to the evolution of the real estate market and the cadastral value coefficients of the Real Estate Cadastre Law.
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