After ten years without a garbage tax, Madrid residents will pay this municipal tax again. The Government Board began this Thursday the processing of the new tax ordinances, which include this new tax burden which is offset by the drop in the IBI to 0.428%, approaching the legal minimum of 0.4%. The average cost of this new tax imposed by the state waste law or “sanchazo”, as the mayor, José Luis Martínez-Almeida, has called it, will begin to be collected from 2025 and will have an average cost of 140 euros, according to the council calculations. For commercial premises, the average fee will be around 310 euros per receipt.
This new receipt will consist of a fixed part (81%) linked to the cadastral value of each home and a variable linked to the generation of waste (19%), prepared from the amount of waste generated and the percentage of quality of the separation of each of the 131 neighborhoods of the cityprovided by the Valdemingómez Technology Park. Madrid has ruled out allocating the cost of street cleaning to this rate, which would increase its cost for the citizen, they have detailed.
The people of Madrid, Almeida has defended, will practically not notice the effects of this “tax” in their pockets thanks to the tax reduction that they have implemented since 2020 and that has allowed the people of Madrid to save 1,027 million euros in five years. This year alone, with the successive reductions in the IBI, Madrid residents will save 220 million euros, to which another 200 million euros must be added as a result of the application of the ruling of the Constitutional Court on the capital gains tax legislation. Thanks to the new garbage rate, the city council’s coffers will have 256 million euros more, Therefore, the decrease in the IBI, stated Engracia Hidalgo, delegate of the Treasury area, compensates almost all of this new tax.
Nearly 1.7 million properties will pay this new garbage rate, with garages and storage rooms associated with a home, plots of land and buildings in a state of ruin being exempt from payment. There will be bonuses, as specified by the mayor, for the large families.
As it is a new tax that will begin to be applied in 2025 – the deadline that municipalities had to regulate this state rate – the city council must notify each taxpayer, who will have two months from then to pay it. “After, from 2026it will be paid like the IBI and taxpayers will be able to choose the frequency with which to pay it,” said Hidalgo.
“More expensive” rentals
The mayor of Madrid, José Luis Martínez-Almeida, also warned of the effect it will have on the rental market, since it will increase the tax pressure on tenants. “According to the norm, the person who has to assume this garbage rate is the one who generates the waste. It is different from the IBI, in which the taxpayer is the owner,” explained Hidalgo. Therefore, although the receipts will be issued in the name of the landlords, they in turn may affect the tenant.
For this reason, Almeida asserted that He does not want to be “talked about stressed areas” nor a cap on rents because the way to cap is “not to establish this rate.”
A “badly designed” rate
In 2025, Almeida has boasted, the IBI in Madrid will be the third lowest in all of Spain, only above Zaragoza and Santander and very close to the legal minimum of 0.4%.
Thus, despite this “fiscal blow” caused by the new garbage rate, the councilor highlighted, Madrid is fulfilling its electoral promise of continuing its path of lowering taxes. In his opinion, the new garbage rate is “poorly designed”, which is why it generates “legal uncertainty” and “will lead to lawsuits” to the City Councils, who have interpreted it in different ways.
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