Andalusia: Madrid's tax policy, at Andalusian prices.
Andalusia relieves wealth tax in full, relieves inheritance between close family almost entirely, and exempts the same 700,000 euro that Madrid does. On income tax it charges two points more at the top. For anyone choosing between the two, that combination means the tax answer is close enough that something else should decide it.
Andalusia spent the last few years deliberately copying the Madrid tax model and marketing the result. It abolished wealth tax in practice, kept inheritance tax nominal between parents and children, cut transfer tax, and deflated its income tax scale. The interesting question is not whether it worked politically. It is whether, for someone actually deciding where to live, the remaining difference against Madrid is large enough to matter.
Enter your base liquidable general — not gross salary. Each region's own scale and its own personal minimum are applied: Madrid substitutes 5,956.65 euro in the regional half, Catalonia and Andalusia apply the state 5,550. A single taxpayer with no children, so the three are directly comparable.
The neatest scale in Spain.
Andalusia did something no other region did: it set its regional rates to exactly match the state rates in four of its five brackets. Only the thresholds differ, and only slightly. The practical consequence is worth remembering.
| Taxable base | Andalusian rate | State rate at that level | Combined marginal |
|---|---|---|---|
| 0 – 13,000 | 9.5% | 9.5% | 19.0% |
| 13,000 – 21,100 | 12.0% | 12.0% to 15.0% | 24.0% to 27.0% |
| 21,100 – 35,200 | 15.0% | 15.0% | 30.0% |
| 35,200 – 60,000 | 18.5% | 18.5% | 37.0% |
| 60,000 – 300,000 | 22.5% | 22.5% | 45.0% |
| Above 300,000 | 22.5% | 24.5% | 47.0% |
In Andalusia you pay almost exactly twice the state rate.
Because the regional rates mirror the state ones, the combined rate is double the state rate through most of the scale. It is the only region where that shortcut works, and it makes mental arithmetic unusually easy: whatever the state takes, Andalusia takes the same again, until you pass 300,000 euro and the state pulls ahead by two points.
Where Andalusia and Madrid actually differ.
| Madrid | Andalusia | |
|---|---|---|
| Regional scale | 8.5% to 20.5% | 9.5% to 22.5% |
| Combined top marginal | 45.0% | 47.0% |
| Regional personal minimum | 5,956.65 | 5,550, the state figure |
| Wealth tax relief | 100% | 100% |
| Wealth tax exempt minimum | 700,000 | 700,000 |
| Inheritance, close family | Relieved almost entirely | 99% relief |
| Transfer tax on a home | Lower general rate | 7% |
Read down that table and the pattern is clear. On everything that touches capital the two are effectively the same policy. On income and on buying a house, Madrid is modestly cheaper. There is no line in it where Andalusia wins on tax.
Because tax was never the deciding variable between these two.
The honest conclusion from four articles of this series is that Madrid and Andalusia are close enough on tax that the difference is swamped by property prices, salaries and how you want to live. That is not a disappointing answer. It means you can make the decision on the things you actually care about, having checked that tax is not quietly costing you a fortune. It is not.
The wealth tax caveat, again.
Andalusia relieves wealth tax by 100 per cent, on an exempt minimum of 700,000 euro with the main home exempt up to 300,000. The same qualification applies as in Madrid: the relief does not remove the state temporary solidarity tax on large fortunes.
Effectively nothing to pay
The regional relief does what it says, and Andalusia sits alongside Madrid, Cantabria, Extremadura, La Rioja and Murcia as a region where wealth tax is not a live cost.
The state tax still reaches you
Above that threshold the position converges with what the state would charge anyway. Whether the money is collected regionally or by the state is an accounting question between administrations; the household pays either way.
For a household in the band between the exempt minimum and three million, therefore, Andalusia and Madrid are both materially cheaper than Catalonia, and Valencia is cheaper than all three because it exempts the first two million outright.
The series, summarised.
| Region | Regional scale | Combined top | Wealth tax |
|---|---|---|---|
| Madrid | 8.5% to 20.5% | 45.0% | Relieved, 700,000 exempt |
| Andalusia | 9.5% to 22.5% | 47.0% | Relieved, 700,000 exempt |
| Catalonia | 9.5% to 25.5% | 50.0% | Not relieved, 500,000 exempt |
| Valencia | 8.8% to 29.35% | 53.85% | Not relieved, 2,000,000 exempt |
Four regions, two clear groups and one outlier. Madrid and Andalusia run the same policy at slightly different prices. Catalonia is the expensive option on both measures. Valencia is expensive on income and the cheapest in Spain on wealth, which is why it belongs in a category of its own.
Is Andalusia a tax haven within Spain?
Andalusia or Madrid for a high salary?
How does the inheritance relief work?
What about buying property?
Does the region change if I keep my company elsewhere?
Two points of income tax. Then choose on everything else.
Talk through your position ↗Alexander Baranov
Seventeen years designing and delivering cross-border corporate structures — incorporation, tax, holding, banking and market entry — for founders and companies expanding into Spain and the EU. Author of professional books on entering the Spanish market.
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