Since 18 July 2023, one year after the start of the tax reform promoted by the Government of the Balearic Islands, a total of 8,572 citizens of the islands have saved 134.92 million euros thanks to the inheritance and gift tax rebates. ‘The results are absolutely satisfactory. We have increased the savings and disposable income of families in the Balearic Islands, we have facilitated access to a first home for those groups with the greatest difficulty in doing so, and we have made it possible to avoid having to pay a single euro for the family estate, the most unfair tax of all’, said the Vice-President and Minister of Economy, Finance and Innovation, Antoni Costa.

The vice-president and councillor for Economy, Finance and Innovation, Antoni Costa, at the presentation of the data. Photo: CAIB.

Inheritance tax groups I, II and III

Specifically, 7,707 people have benefited from 100% relief on inheritance tax, with a total saving of 116.04 million euros, equivalent to an average of 15,000 euros per taxpayer. These cases correspond to groups I and II, i.e., between ascendant relatives, descendants and spouses. It should be noted that 63% of these cases have been inheritances in life or inheritance agreements. As for the 50% allowances in group III -when the inheritance is between siblings, uncles, aunts and nephews-, 743 taxpayers benefited, with a total saving of 16.31 million euros and an average of 21,900 euros per person.

In the area of donations, 9 taxpayers have benefited from the allowances applied to donations of real estate to children or descendants that constitute their first home, with a total saving of 0.17 million euros. In addition, 113 people have benefited from the allowances for cash donations for the purchase of their first home, for a total saving of 2.4 million euros.

Property transfer tax

Transfer tax was the second tax to be modified in the first phase of the tax reform. In total, the transfer tax rebates have benefited 3,664 taxpayers, with a saving of 37.18 million euros.

In this case, 660 young people under 30 years of age and people with disabilities have benefited from the 100% tax rebate for the purchase of their first main residence. The total saving amounts to 14.01 million euros, with an average of 20,000 euros per taxpayer.

Secondly, 1,096 people under 36 years of age, large families, single-parent families or families with disabled dependents have benefited from the 50% tax reduction, which has led to a saving of 10.61 million euros, with an average of 9,600 euros per taxpayer. Finally, 1,908 citizens over 36 years of age have benefited from the improvements introduced in the 4% rate of the tax, which has led to a saving of 12.56 million euros, with an average of 6,500 euros per taxpayer.

Adding these figures to those for inheritance and gift tax, the total number of citizens who have benefited is 12,236.