The construction, installations and works tax (ICIO)

El impuesto de construcciones, instalaciones y obras (ICIO)
The construction, installations and works tax (ICIO)

What is the construction, installations and works tax?

The Construction, Installations and Works tax levies, as is known,

“… the realization, within the municipal area, of any construction, installation or work for which obtaining the corresponding license of works or urban planning, whether or not said license has been obtained, provided that its issuance corresponds to the City Council of the imposition.” (art. 100.1 TRLHL).»

The taxpayers of this Tax are the owners of the real estate on which the constructions, installations or works are carried out, provided they are the owners of the works ; in all other cases, the person holding the status of owner of the work will be considered a taxpayer (art. 101 TRLHL).

The TRLHL also provides for the status of substitute taxpayers for the taxpayer to

“… who request the corresponding licenses or carry out the constructions, installations or works, if they are not the taxpayers themselves.” (art. 101.2 TRLHL).»

The City Council, when granting the license, will make a provisional settlement on account, according to art. 103.1 TRLHL.

This Tax, as occurs with rates, may be required under a self-assessment regime (art. 103.4 TRLHL).

Art. 102.1 TRLHL, in its current wording, provides that:

“1. The tax base of the tax is constituted by the real and effective cost of the construction, installation or work, and is understood as such, for these purposes, the cost of material execution of the former.

Value Added Tax and other similar taxes under special regimes are not part of the tax base , taxes, public prices and other patrimonial benefits of a local public nature related, where appropriate, to the construction, installation or work, nor the professional fees, the contractor’s business benefit or any other concept that does not integrate , strictly, the cost of material execution.”

The jurisprudence, already prior to the entry into force of this legal precept, had initiated a doctrinal line in which what should be considered the tax base of this municipal tax was specified.

You can see, in fact, how already the SSTS 1.02.94, of 2.04.1996 (with citation of the SSTS of 21 and 25.02.1995 ) considered that the fees of the Architect and Surveyor are not part of the tax base, since the budget to be considered is that of the material execution of the works.

SSTS 3.02.94 and 10.28.1996 broaden this idea in the sense that neither are general expenses nor profit part of the tax base industry.

Finally, the SSTS of 01.16.95, 01.18.1995 and 02.27.95 consider that the amount of the machinery to be installed in the works. The Supreme Court is forceful, in repeated and constant jurisprudence, in this regard. Indeed, it maintains that the cost of the installation should be included in the tax base of the INICIO tax, but not “the cost of the installed”.

For the taxable event of the ITIO to occur, therefore, it is requires that the license refer precisely to the carrying out of any construction, installation or work, a phrase to which a meaning cannot be given such a broad meaning that it includes any transformation operated on a certain piece of land, but must It is a modification that takes place in the placement of a building, structure or fixed or mobile element of such a nature that is subject to municipal authorization.

In this sense, the jurisprudence has manifested itself, declaring the non-subjection to the ICIO of extractive mining and quarrying activities, even when they are subject to a license earthworks, noting that any earthworks unrelated to building or construction acts should not be subject to tax, since it does not tax the development of industrial activities in general but the carrying out of works, otherwise, if tax industrial activities, it would affect the activity of companies, already taxed by the Tax on Economic Activities.

Among others, see, in this regard, the Judgments of the Superior Court of Justice of Castilla-La Mancha of July 31, 1995 (EC 2376/1996), Superior Court of Justice of the Canary Islands of December 9, 1996 (EC 3288/1997) and Judgments of the Supreme Court of October 22, 2001 (La Ley 2002, 1885), December 29, 2001 (La Ley 2002, 3108), February 25 of 2002 (Law 2002, 5015) and April 17, 2002 (Law 2002, 5965).

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