Tax revenues collapse in the province laid bare

The collapse of the Spanish economy caused a massive drop in the amount of taxes collected from across Spain. But a new study by the association of tax inspectors Gestha has laid bare the true cost to Spanish coffers.

Almería was -and continues to be- one of the provinces which was most affected by the bursting of the economy bubble in 2008. This was most evident in 2012, when the province had the highest unemployment rate of mainland Europe and a corporate bankruptcy rate of several businesses a day. At one point, nearly 40 per cent of the active workforce or 135,700 people were seeking employment.

This dramatic economic collapse lead to a drastic drop in tax revenue collected here, bringing Almería to the forefront in the Gestha study.

Spain collected over 253 billion euros less than it had expected to over the six year period according to the analysis released this week. But across the nation, Andalucía was only the fourth most affected region. Tax revenues dropped more in Catalonia, Madrid and Valencia.

34 billion euros lost

The tax authority AEAT said that this massive black hole in the nations finances was directly caused by the recession, but added that increased tax evasion and unemployment had worsened the figures.

The study looked at the income produced by the three main forms of taxation used by the state: personal income tax (la renta), IVA and corporation tax.

Andalucía as a whole generated 34 billion euros less in these taxes for the nation. The most affected province was Málaga, which lost more than 9 billion euros in tax. The main agricultural provinces of Huelva and Jaén fared better, with a drop of only around 1,5 billion in both cases.

Almería, despite its small size, was the third most affected province and 3,7 billion euros in tax was lost.

By form of taxation, 1,8 billion came from corporation tax, 1,2 billion in IVA and 767 million euros in personal income tax.

This lost money has dramatically impacted upon state capital investment over the last half decade. To put things in perspective, the lost income was enough to finish the Almería AVE and still have enough left over to build 47 maternity hospitals.

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