Date: 10.04.2024

by Kajetan Sawicz

Spain’s Tax Authority Intensifies Focus on Online Gambling Winnings

In a significant shift in tax oversight, the Agencia Tributaria (AEAT), Spain’s Tax Agency, led by Director General Soledad Fernández, is enhancing its surveillance over profits generated from various sectors, notably including online gambling.

This adjustment mandates Spanish consumers to report any earnings from online gambling activities within their 2023 self-assessment income tax filings, as highlighted in recent media disclosures.

AEAT Rolls Out New Tax Reporting Directives

As the 2023 tax filing season approaches, AEAT has dispatched close to 2.9 million notifications to taxpayers, emphasizing the need to declare earnings from diverse activities such as online gambling, cryptocurrency dealings, property leases, and overseas income. This initiative marks the inaugural issuance of notices specifically targeting profits derived from online gambling, with an impressive count of 164,000 advisories distributed.

Following a pivotal update to Tax Module-190 in 2022, the AEAT has adjusted the reporting criteria for gambling prizes or winnings to include amounts under €300, significantly affecting tax declarations for 2023. This marks a substantial change from the prior threshold of €1,000, necessitating Spanish taxpayers with an annual income exceeding €22,000 to report gambling winnings amounting to €300 or more.

AEAT’s Tiered Tax System and Streamlined Filing Process for Gamblers

The AEAT has instituted a tiered taxation system for sports betting and online gambling winnings, spanning from 19% to 45%, contingent upon the total winnings. This structured approach imposes a 19% tax on earnings up to €12,450, escalating to 24% for amounts between €12,450 and €20,200, 30% on the bracket of €20,200 to €35,200, 37% for the range of €35,200 to €60,000, and culminating at 45% for winnings exceeding €60,000.

AEAT’s concerted efforts are geared towards simplifying the process for amending or presenting specific declarations concerning gambling, cryptocurrency, and foreign income transactions. This initiative aims to provide taxpayers with convenient tools to modify reported amounts in their tax filings effectively.

Our Comment on the Article

While this move seeks to streamline tax filings and uphold fiscal responsibilities, it has sparked debate, particularly from the conservative Partido Popular (PP), who critique these changes as overly punitive for casual gamblers. This development underscores the balancing act between regulatory enforcement and fostering a fair recreational environment for consumers. As these regulations take effect, the impact on Spain’s online gambling landscape and taxpayer compliance will be pivotal areas to monitor.

Related posts