It represents a reduction in the estimated tax base of 1,807 million, the most far-reaching in the last decade, according to the Executive


The Ministry of Finance and Public Function has published this Tuesday an order in the Official State Gazette (BOE) establishing a general reduction in net income of 25% in Personal Income Tax (IRPF) that It will benefit 800,000 farmers and ranchers who pay taxes through the module system.

Specifically, this order includes the proposal of the Ministry of Agriculture, Fisheries and Food to reduce said indices and takes into account the incidence of drought and other exceptional circumstances that affected the profitability of many agricultural and livestock farms during 2022, such as the war in Ukraine, which caused a rise in production costs.

In addition to the 25% reduction in general for all farmers and ranchers, certain sectors that are in a more vulnerable situation will benefit from specific reductions.

Thus, in the case of olive groves, almond trees and beekeeping, the reduction amounts to 50%, while it will be 30% for cereals, oilseeds and legumes, chestnut, peach, nectarine, apricot and other livestock sectors.

The Government has estimated that the set of reductions contemplated in this order represents a reduction in the tax base of the order of 1,807 million euros, making it the most far-reaching in the last decade.

In this way, this order also allows declarants in an objective agricultural estimate of personal income tax to reduce the previous net yield by 35% for the purchase of agricultural diesel, and 15% for the purchase of fertilizers, as established in Order HFP/1172 /2022, of November 29, which develops the objective estimation method of personal income tax for 2023.

In addition, the reductions in the corrective indices that were established last year for feed purchased from third parties and for crops on irrigated land that use electricity are maintained.

Specifically, the rate applicable to livestock activities that feed livestock with feed and other products purchased from third parties is established at 0.5, provided that they represent more than 50% of the amount of food products consumed, and applies to both intensive and extensive livestock sectors. The correction index for crops on irrigated land that use electricity is reduced to 0.75.

In addition, a large number of reductions have been made at the regional, provincial or municipal level in other productions, among which those approved for non-citrus fruit trees in important producing areas stand out.

The Minister of Agriculture, Fisheries and Food, Luis Planas, had already advanced in recent days that the Government of Spain was working on the design of measures to combat the drought, “an exceptional situation”.

Thus, the head of the branch presented last week in the Council of Ministers a report on the fight against drought, which included actions for 2,130 million euros, an initiative that he described as “absolutely necessary from the point of view of better use of water and a decrease in the energy bill”.