The accumulated collection of the IGIC during the first semester of the year was 931 million euros, according to data from the Canary Islands Tax Agency. This amount represents an 11.7 percent increase over 2019 -the last year developed under normal economic circumstances- and a significant moderation compared to the data from the first quarter of 2022, when it increased by 19%, also in relation to the same period of 2919.
When evaluating the collection growth, it must also be taken into account, with respect to the 2019 data, that at that time the general IGIC rate was 6.5% and now it is 7%, which explains part of the increase.
According to the monthly report prepared by the Canary Islands Tax Agency, the increase shows the economic recovery and greater consumption due to the normalization of the arrival of tourists and the greater savings generated during the crisis caused by COvid-19. In addition to these circumstances, the generalized rise in prices also influences, which increases the taxable bases of this tax.
The Canarian Vice President and Minister of Finance, Budgets and European Affairs, Román Rodríguez, had already anticipated the slowdown in the rate of IGIC collection, the most important tax of the Canary Islands Financing Block (BFC) and, in parallel, the increase in public spending that administrations such as the Canarian one must face, in addition, with the consideration that 58% of the collection for this concept is allocated to councils and municipalities, compared to 42% that remains in the regional coffers.
In relation to this last aspect, Rodríguez has insisted that the Executive's obligations have multiplied in recent years due to the pandemic -which forced the reinforcement of essential public services and the release of extraordinary funds to help the productive sectors- and, now, with the escalation of prices.
“This means -explained the vice president- that we will need all available resources to maintain the intensity of the services we provide to citizens and also to activate aid to the sectors of society and the economy most exposed to inflation.” While the IGIC collection has grown by 11.7 percent in the first semester of this year compared to 2019, the Government of the Canary Islands has consolidated public spending that has grown more than double in the same period, according to the calculations of the Treasury.
Canary Islands Financing Block
The accumulated collection of the so-called Canary Islands Financing Block -which includes, in addition to the IGIC, the AIEM and the Registration Tax- reached 1,054 million euros, which represents an increase of 14% compared to the year 2019. Of that total amount, councils and municipalities are the main beneficiaries, receiving 58%.
In a disaggregated manner, 110 million euros were collected for the AIEM and 8.5 million for the Registration Tax.
With regard to own and assigned taxes, the collection reached 482.6 million euros, 9.3% more than during the first semester of the 2019 financial year.
Fuels: a special case
Within this section of own and assigned taxes, the Special Tax on Petroleum-Derived Fuels stands out, whose accumulated collection has fallen by 8.45 compared to the first semester of the year 2019, going from 164.4 million euros to 150 million collected so far in 2022.
The collection of this tax has not been affected by inflation, because it is not an “ad valorem” tax -according to the transaction value-, but a special tax that falls on the liters of fuel that are subject to wholesale delivery.
In that sense, the gross collection levels have practically reached the amounts collected before the start of the crisis caused by COVID-19, which shows the economic recovery in the sectors affected by fuel consumption.
The net amount of collection of this tax is below the monthly amounts of previous years due to the increase in the percentage in the Refund of professional diesel and gasoline in the Special Tax on Petroleum-Derived Fuels agreed by the Government of the Canary Islands in order to alleviate the energy crisis derived from the war in Ukraine.
It so happens that the Government approved in March an increase in the refund that it practiced to carriers, farmers and ranchers, which went from 68% to 99.9%. In four months, the fiscal cost of this measure has been almost 6 million euros. In total, the Government has returned 23.2 million euros this year.