Skip to main content


Don't miss out on information about the foundation's activities! Leave us your email and you will receive in your inbox all the news about our work.

Taxation of business profits: recent trends, future prospects

Following eight years of research, the Board of Trustees of Fundación Impuestos y Competitividad has resolved to promote a study focused on Corporate Income Tax, there being many reasons supporting this decision.

The recent comprehensive regulation of this tax by means of Law 27/2014 could be seen as a sufficient motive, but the research is also encouraged by other factors.

As an example, the habitual controversies surrounding trends in tax revenue since the crisis that began in 2007-2008 and the consideration of whether or not it is sufficient for the primary tax on business activities; or discussions as to what is the effective tax rate borne by companies and whether or not it is suitable. Both aspects now play an important role not only in the sphere of ideas and technical debate but also at the practical level, a variety of measures having been adopted to review the regulation of this tax in recent years so as to improve its contribution to fiscal consolidation, and there is still speculation regarding the need for new solutions to guarantee a minimum tax on businesses.

In addition, the practical consequences of the detailed review of international business taxation, of multinationals in particular, undertaken by the BEPS Action Plan, are the main new developments in the regulation or practical application of this tax*. Particularly worthy of note is the obligatory influence on Corporate Income Tax regulations of new solutions in connection with the “digitalisation of the economy”, which is one of the key focuses of international efforts to bring in new taxation suited to globalisation and the unstoppable expansion of a business model in which a physical presence is no longer an essential distinguishing feature.

This interesting project has been undertaken with the support of professionals from the firms forming the Foundation’s Board of Trustees and also a broad team of reputable academics and public officials from the Tax Authorities, with different professional profiles and experience, thereby clearly enriching the process; all those involved have been coordinated by professionals from DELOITTE Asesores Tributarios, the firm to which the authorship of the book containing the study findings is attributed. We must not forget the list of specialists in various areas that have also taken part in the debates (as many as four) held as a work tool in the interests of the project; their assessments have also doubtless helped to assure a more complete and efficient research process.

The book, published in 2019 under the title “Taxation of business profits: recent trends, future prospects” (“Imposición sobre el beneficio empresarial: evolución reciente, perspectivas de futuro”) has three parts; the first contains a retrospective analysis addressed from three different perspectives, analysing statistical tax revenue data, the relationship between book profits and tax quantification and, finally, regulatory trends from the viewpoint of constitutional principles.

The second part deals selectively with aspects of the current regime regarded as the most relevant, focusing in more depth on the keys to current regulation and suggesting improvement measures. Particular attention is paid to the aspects of Corporate Income Tax legislation that are affected by the European Directives ATAD 1 and ATAD 2 on the harmonisation of measures derived from the BEPS Plan in the EU and are thus subject to the requirements of a potential transposition.

The guiding principle of the proposals made is the defence of the competitiveness of Spain’s economy, placing special emphasis on the rejection of measures “resulting from the crisis” that weigh down business activity by imposing a tax burden that is not always consistent with the benefit achieved, particularly where doubts are raised as to their compatibility with constitutional principles.

Finally, the third part expands on the proposals to be considered in the future debate on the taxation of business activities, structured in four groups by reason of origin. Those deriving from the OECD, the European Union, measures already approved by different States and those that are essentially supported by expert opinion / the proposals of the authors.

Besides disclosing these proposals, the study has sought to outline (in the consideration included in the general conclusions) a set of essential matters that academics, first, and legislators, later, must resolve in order to lay down the essential parameters for the future in this area of taxation. It aspires merely to outline the questions to be answered and, at most, to suggest a prudent approach to the ideal solutions, or at least an indication of some hurdles to be overcome.

Above all, the book seeks to assist the social partners that are involved and play a key role in the search for solutions in an effective analysis that will guide appropriate decision-making in the way that best suits Spain’s general interests, all of which is consistent with the purpose of Fundación Impuestos y Competitividad’s activities.

This work has been carried out with the help of the foundations of the Spanish Banking Association (AEB), the Asociación de Promotores Inmobiliarios de Madrid (Madrid Property Developers’ Association, ASPRIMA) and Spanish Savings Banks under the relevant Collaboration Agreements.

* Los criterios de cuantificación de la renta y cuotas tributarias del Impuesto sobre Sociedades son trasladables asimismo al marco del Impuesto sobre la Renta de los No Residentes cuando se trata de gravar a empresas no residentes en España, e incluso en parte al Impuesto sobre la Renta de las Personas Físicas, para el caso de empresas de titularidad individual.