Car Taxes in Spain In 2024, the Spanish automotive sector contributed a total of €39.838 million in taxes and fees, marking a 1.7% increase compared to 2023. Whether purchasing or using a new or used vehicle, several taxes apply—some one-time, others recurring.
Car Purchase Taxes in Spain
The primary taxes involved in purchasing a vehicle include:
- Value Added Tax (VAT or IVA)
- Registration Tax (Impuesto de Matriculación – IEDTM)
- Transfer Tax (Impuesto de Transmisiones Patrimoniales Onerosas – TPO)
Value Added Tax (VAT or IVA)
Purchasing a new car in Spain, whether by individuals or companies, is subject to VAT. For used cars, VAT applies only if the seller is a VAT-registered business. Self-employed individuals or companies may be eligible to deduct VAT on purchase, maintenance, and use depending on their business activities and vehicle type.
VAT is paid by the buyer, although the seller is responsible for declaring it. The standard VAT rate is 21% of the taxable base. A reduced rate of 4% applies to vehicles adapted for people with disabilities.
Registration Tax (Impuesto de Matriculación – IEDTM)
The registration tax is payable when acquiring a new vehicle or importing a used vehicle not previously registered in Spain. Certain exemptions exist, including vehicles for people with disabilities, taxis, and motorcycles with engines of 250 cm³ or more.
The tax rate depends on CO₂ emissions and the autonomous community of residence. The taxable base is the vehicle price excluding VAT. Rates typically range from 0% to 14.75%, distributed as follows:
- 0% for vehicles emitting up to 120 g/km CO₂
- 4.75% for emissions between 120 and 160 g/km
- 9.75% for emissions between 160 and 200 g/km
- 14.75% for emissions above 200 g/km
In Catalonia and the Valencian Community, the highest rate for vehicles emitting over 200 g/km has been increased to 16%. Many regions also offer tax reliefs or exemptions. Typically, the buyer pays this tax, but dealers usually handle the administrative procedures.
Transfer Tax (Impuesto de Transmisiones Patrimoniales Onerosas – TPO)
Private sales of used vehicles between individuals are subject to the Transfer Tax (TPO), regulated by each autonomous community. Rates vary between 4% and 8%, calculated on the vehicle's fiscal value.
The Spanish Ministry of Finance publishes annual valuation tables for used vehicles, which serve as the basis for tax calculation. Depreciation is applied based on the vehicle's age. In some regions, the tax is calculated on the higher of the official valuation or the actual purchase price.
Car Ownership Taxes in Spain
Ongoing taxes and fees related to vehicle ownership include:
- Municipal Motor Vehicle Tax (Impuesto Municipal sobre Vehículos de Tracción Mecánica – IVTM)
- Hydrocarbon Tax (Impuesto sobre Hidrocarburos)
- Insurance Premium Tax (Impuesto sobre las Primas de Seguro – IPS)
- Technical Inspection Fee (Inspección Técnica de Vehículos – ITV)
- Toll Road Charges
Annual Municipal Motor Vehicle Tax (IVTM)
Commonly known as the Impuesto de Circulación, this annual tax is levied by municipalities based on the vehicle's fiscal horsepower (CVF) and fuel type. The tax campaign typically runs from April to late May or early June.
While national legislation sets minimum and maximum rates, municipalities have discretion within this range and may offer reductions for environmentally friendly vehicles, such as those with "0" or "ECO" environmental labels. Historic vehicles and those older than 25 years may be exempt.
Taxpayers are registered owners as of January 1st of the tax year, and payment is made in the municipality where the vehicle is registered, which must match the owner's residence. Typical annual amounts range from €15 to €150.
Hydrocarbon Tax
This excise duty applies to fuels on the Spanish mainland and Balearic Islands but not in the Canary Islands, Ceuta, or Melilla. Different rates apply depending on the fuel type. The government aims to promote vehicle electrification and reduce fossil fuel dependence, planning to increase diesel taxes to align with petrol rates.
Catalonia imposes an additional surcharge of 4.8 cents per litre, generating approximately €215 million annually. Since 2022, Catalonia also levies a CO₂ emissions tax on passenger cars and motorbikes exceeding 120 g/km, and on trucks up to 3.5 tonnes exceeding 160 g/km.
Insurance Premium Tax (IPS)
Since 1997, car insurance premiums in Spain include an 8% Insurance Premium Tax. Although insurance services are exempt from VAT, they incorporate contributions to the Insurance Compensation Consortium and the Liquidation Commission of insurance entities.
Technical Inspection Fee (ITV)
Vehicle owners must undergo periodic Technical Inspections (ITV) at authorized centers to ensure safety and environmental compliance. Cars between 4 and 10 years old require inspection every two years, while those older than 10 years must be inspected annually. Fees vary by region, averaging between €32 and €35 nationally.
Toll Roads
Certain Spanish motorways charge tolls, operated by private concessionaires responsible for maintenance and toll collection.
The European Commission has urged Spain to implement a general road usage charge for motorways and high-capacity roads, similar to systems in countries like Austria. Initially planned for 2024 at a rate of one cent per kilometre, this initiative has yet to advance.