The tax law is the one that regulates the general and common principles of taxes and which must be applied in all cases related to them. It establishes taxes, extinguishes them and determines when and how they must be paid.
The tax rule is within the tax law. These rules as a whole make up the General Tax Law. This norm lists the different types of taxes and their characteristics, gives definitions such as what a tax is or what term it has for its payment and regulates the quantification of taxes.
The main characteristics of the tax regulation are:
- It belongs to public law, especially financial and tax law.
- They are mandatory rules, they cannot be agreed or negotiated between parties.
- They follow a principle of equity.
- It empowers to establish mandatory contributions by law.
- It establishes sanctions and fines for taxpayers if they do not comply with their tax obligations.
- The tax law stipulates: management, collection, inspection and tax penalty. It also determines the subsequent administrative claim if the citizen does not agree with the application of the tax law.
- This rule will be applicable once it is published in the Official State Gazette. Some tax regulations only have a certain temporary validity.
Structure of the tax regulation
The standard is made up of:
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- Taxable event: it is the budget of fact or the occasions that when they occur give rise to the obligation to pay this tax. For example, the fact of buying real estate from another person is a taxable event that generates the obligation to pay the Onerous Property Transfer Tax.
- Taxpayer: the taxpayer is a natural or legal person who is obliged to comply with the tax duties and with the formalities inherent to it.. The taxpayer does not have to be the person who carries out the taxable event that gives rise to the tax obligation, it is simply the person obliged to comply with the taxes.
- Tax: once the taxable event and the taxpayer have been determined, all that remains is to indicate what the tax to be paid will be and its quantification.
The tax law has as its main element the collection and delimitation of taxes, but what are these?
Taxes are the largest source of revenue for a State. It is a monetary contribution to the coffers of the public administration established by the General Tax Law. This means that the tax norm will establish a factual assumption that, when carried out by the taxpayer, will generate the obligation to pay a tax.
There are three types of taxes that are differentiated by the assumption of fact that generates the obligation to contribute to the state in a pecuniary way:
- Taxes: The assumption of fact in taxes is varied, but they are usually acts that demonstrate the economic capacity of the taxpayer, such as the purchase of a house.
- Rates: the factual assumption is the private use of a public domain asset. For example, if a bar wants to use public space on the street to put some tables and expand its business area, it must pay a fee.
- Special contributions: the assumption in fact is the performance of public works that generate a benefit for the taxpayer or increase the value of their property. For example, if a street where there is a restaurant does not have good public lighting and this is changed and the pavement of the street is also improved, the value of the private premises will rise.