According to a study by the Institute of Fiscal Studies (IEF) at Castilla-La Mancha reduction of the Personal income tax compared to 2011 will be 8%, while in Catalonia it will barely reach 0.9%, and this happens because the complete reduction of Personal Income Tax, which came into force in January 2016, will have an unequal effect on the different autonomous communities, since the reduction will be greater among the communities that have the lowest incomes and to this we must add that each autonomous government has introduced its own changes to 50% of the tax on which they have ceded the regulatory capacity.
Thus, the average tax reduction in 2016 for all Spaniards compared to what they paid in 2011 is 3.74%. According to the IEF study, with the latest reform, the progressivity of the tax has been increased,so the reduction in Personal Income Tax is greater depending on whether you have a lower per capita income.
Therefore in communities such as Catalonia, this reduction will practically not be noticed since there is a higher per capita income and also the regional government has raised the regional share of the tax, this being in 2016 8.6% higher than the state quota, so that will collect 645 million euros more for the part of the tax that has been assigned.
As for the rest of the autonomous communities, a total of 10 communities will enjoy a reduction in Personal Income Tax in 2016 higher than the national average, among which are Andalusia, Asturias, the Canary Islands or Cantabria. With a lower than average reduction would be Aragon, Balearic Islands, Valencian Community, Community of Madrid and closing the table, Catalonia.
Not included in the study, because they have their own tax regime, are the foral communities of the Basque Country and Navarre, which have their own tax regime, nor the autonomous cities Ceuta and Melilla.
According to the IEF, the reduction in personal income tax between 2011 and 2016 means 2,400 million less income,up to 62,911.74 million euros. There was the largest decrease in Andalusia, with a reduction in collection of 523 million, followed by Madrid with 487 million and Castilla y León with 237 million less. The smallest reduction in absolute terms will occur in La Rioja with only 18 million less, the Balearic Islands with 35 million and Cantabria with 48 million less.