It is understood as a special contribution to the payment in money that a passive subject or taxpayer makes to the active subject or State. This payment is a contribution to finance the expense that the State makes when carrying out a public work or to offer a public service that benefits society.
In other words, a special contribution is a mandatory payment that must be made by the taxpayer. But, at the same time, this contribution must generate a benefit for the taxpayer. The benefit may be the construction of a public work such as a bridge or a road. Likewise, it could be the expansion of public services such as the construction of more hospitals or schools.
Obviously, the money collected can only be used for specific and determined purposes. These contributions cannot be used for other purposes or expenses other than the provision of public services or the generation of public works.
Characteristics of a special contribution
However, depending on the legislation of each country, special contributions may have different names. Among the most common names we find: special tax, special tribute, special contribution, improvement contribution and even capital gains tax.
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Regardless of the name assigned to it, the main characteristics of a special contribution are the following:
- They must be established by law: This implies that the required collection must be legally justified and authorized. The country’s legislative body must enact the law that serves as the basis for charging.
- They have to be mandatory: Since it is supported by a law, the payment or contribution is mandatory.
- Applied proportionally and equitably: This characteristic implies that the special contribution must adhere to tax justice,
- Must be used to finance government spending: It means that it should only be required when the proceeds are used by the State to carry out a work or service that is of interest and social benefit.
Difference between tax and special contribution
Naturally, it is very common for taxes to be confused with special contributions. Therefore, it is convenient to establish the fundamental differences between both concepts.
Why is a tax paid and why is a special contribution paid?
To begin with, a tax is an amount of money that is paid to the State. But this payment is generally made based on the level of consumption, the level of income or on the assets owned by the taxpayer.
Meanwhile, a special contribution is paid in order to support the financing of public works carried out by the State. In addition, so that it can provide public services and social benefits. It is clear that the taxpayer receives a benefit.
In the case of a tax:
- The taxpayer performs some type of productive activity or an act that generates the payment.
- In a tax, the taxpayer does not obtain a determined or specific benefit.
- The State can use the income from the tax by only carrying out the collection process.
- Your payment is mandatory because it is established by law.
- Taxes are established according to the participation that the taxpayer has in the economic activity.
In the case of a contribution:
- The taxpayer pays the contribution to cover the performance of state works and the provision of social benefit services.
- The contribution or payment made by the taxpayer depends on the benefit that he will be able to obtain.
- It is also a mandatory payment for the benefit received by the taxpayer. Payment is made in exchange for obtaining a particular benefit or service.
In conclusion, it can be stated that every contribution is an obligatory tribute by the taxpayer. This payment generates benefits for society such as the performance of public works, the provision of public and social services executed by the State or active subject.