The following are the most important modifications classified by each tax introduced by mentioned Royal Decree published last 31st December on the Official Spanish Gazette.
PROPERTY TAX
Generally, for 2012 and 2013 tax years, tax rates are increased in a complex manner to 10%, 6% or 4% over current tax rates from each territory in where tax payers must take into account the dates of the last review regarding the cadastral values of the properties .
PERSONAL INCOME TAX
 Temporarily, for 2012 and 2013 tax years, the Royal Decree establishes an additional tax rate ranging between 0,75% and 7% (the latter is provided to net tax bases higher than EUR 300.000,3).
That means that the maximum tax rate will be between 52% and 56%, depending on the part of the territory (“Comunidad Autónoma”) where the tax payer has its residence.
This additional tax rate will be only applied to income integrated on general tax base; so that, it will be applicable to: employment income, income derived from an economic or business activity, income derived from renting a real estate, and certain capital gains.
 Also, temporarily applicable for 2012 and 2013 tax years, it is established an additional tax rate ranging between 2% and 6% (the latter is provided to net tax bases higher than EUR 24.000).
This additional rate will increase the maximum tax rate for the so called “saving income” (dividends, interests, etc…) to 27%.
 In order to include the additional tax rate explained on the first paragraph, the rules to calculate withholding tax rates have been changed. However, this modification will be only applicable as of 1st February, 2012.
 Employment income received by Directors, members of Board Directors, and members from representative bodies will be withheld at 42% instead of 35%.
 Also it is increased from 19% to 21%, the withholding tax or the payments on account applicable to:

• Investment income.
• Capital gains arising from sale or refund of shares from Collective Investment in Transferable Securities.
• Prizes obtained because of the participation on some lotteries, competitions, raffle, and other plays.
• Incomes derived from renting and subleasing of real estates.
• Incomes derived from Intellectual and Industrial Property, from rendering technical assistance, from renting movable estates, business or mines, and for subleasing them.
• Income imputation derived from images rights transactions.
 The deduction for acquiring a dwelling it has been reintroduced with effects from 1st January 2011 on the same terms as it was current when it was abolished last year. The maximum deduction base is increased from EUR 9.015 to EUR 9.040; furthermore, the deduction for making reparations to adapt the residence is also increased from EUR 12.020 to 12.080.
 It will be extended, during 2012 tax year, the tax incentives to promote new technologies utilization and employees training, for those tax payers that practice an economic activity and have employees; it is also extended during 2012 tax year, incentives for those who contract employees, in the same way as establishes the Corporate Income Tax Law.
CORPORATE INCOME TAX
 Withholding Tax is increased from 19% to 21%.
 Minimum tax rates applicable to entities with a turnover less than EUR 5.000.000 increasing their employees is also extended during 2012 tax year.
NON-RESIDENTS PERSONAL INCOME TAX
 The general tax rate has being increased from 24% to 24,75%.
 Spanish permanent establishments of foreign entities will be taxed because of the remittance of profits abroad, with an additional tax rate increased from 19% to 21%.
 Withholding Tax on dividends and interests received by non-residents and capital gains obtained by non-residents without permanent establishment, among others, will be also taxed at 21%, instead of 19%, that was the rate before 1st January, 2012.

VALUE ADDED TAX
 It is extended, until 31st December, 2012, the reduced rate applicable to the transmission of the dwelling.
All these tax measures (except the one related to employment Withholding Tax and the deduction for acquiring a dwelling that will come into effect as of 1st January, 2011) are applicable from 1st January 2012.

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