Car taxes in Spain In 2024, the total amount of taxes and fees collected by the Spanish state from the automotive sector reached 39.838 million € – 1.7% more than in 2023. Both the purchase and the use of a new or used car involve paying several different taxes. Some of them are one-off, others are paid on a regular basis.

Car purchase taxes in Spain

This category includes:

  • VAT (IVA)
  • Registration tax (Impuesto de matriculación – IEDTM)
  • Transfer tax (Impuesto de transmisiones patrimoniales onerosas – TPO)

VAT (IVA)

The purchase of a new car in Spain, whether by individuals or legal entities, is subject to VAT. VAT is also charged on the purchase of a used car if the seller is a VAT-registered company. In turn, if the buyer is a self-employed entrepreneur or a company, depending on the type of activity and the type of vehicle, it may be possible to deduct VAT both on the purchase and on subsequent use and maintenance.
VAT on the purchase is paid by the buyer, but the obligation to declare it rests with the seller. The standard rate is 21% of the tax base. For vehicles intended for people with disabilities, the rate is reduced to 4%.

Registration tax (Impuesto de matriculación – IEDTM)

The registration tax (IEDTM) – in other words, the tax for obtaining Spanish number plates – must be paid both when buying a new car and when importing a used car from abroad that has not previously been registered in Spain. There are a number of exemptions where IEDTM is not payable, for example: vehicles for people with disabilities, taxis, motorbikes with an engine capacity of 250 cm³ or more and some other categories of vehicles.
The IEDMT rate depends on CO2 emissions and on the autonomous community where the buyer resides. The taxable base is the car price net of VAT. In most autonomous communities, the tax rate ranges from 0 to 14.75%:

  • 0% – cars with CO2 emissions up to 120 g/km.
  • 4.75% – cars with CO2 emissions from 120 to 160 g/km.
  • 9.75% – cars with CO2 emissions from 160 to 200 g/km.
  • 14.75% – cars with CO2 emissions above 200 g/km.

In Catalonia and the Valencian Community, the maximum rate (for CO2 emissions above 200 g/km) has been increased to 16%. Many regions also offer tax reliefs.
The car registration tax in Spain is paid by the buyer, but all the administrative formalities are normally handled by the car dealer.

Transfer tax (Impuesto de transmisiones patrimoniales onerosas – TPO)

Private-to-private car sales in Spain are also subject to tax. In particular, the purchase of a used vehicle by one individual from another falls under the regime of onerous transfer of assets (Impuesto de transmisiones patrimoniales onerosas – TPO) within the framework of the Transfer Tax and Stamp Duty (Impuesto sobre Transmisiones Patrimoniales y Actos Jurídicos Documentados – ITP-AJD). This tax is regulated at the level of the autonomous communities, so payment deadlines, tax rates, reliefs and deductions can vary significantly from region to region.
TPO rates range from 4% to 8%, and the tax base is the fiscal value of the vehicle. Each year, the Spanish Ministry of Finance publishes in the Official State Gazette (BOE) valuation tables for used vehicles (all models and versions), which must be used to calculate the tax. A depreciation percentage is then applied to the assessed value depending on the age of the car. In some autonomous communities, the tax is calculated on the higher of two amounts: the assessed value from the Ministry of Finance tables or the actual purchase price.

Car ownership taxes in Spain

This category includes:

  • Municipal tax on motor vehicles (Impuesto Municipal sobre Vehículos de Tracción Mecánica – IVTM)
  • Hydrocarbon tax (Impuesto sobre Hidrocarburos)
  • Insurance premium tax (Impuesto sobre las Primas de Seguro)
  • Technical inspection fee (Inspección Técnica de Vehículos – ITV)
  • Toll roads

Annual municipal motor vehicle tax (Impuesto Municipal sobre Vehículos de Tracción Mecánica – IVTM)

This tax is often referred to by its short name – Impuesto de Circulación. It is an annual municipal tax calculated on the fiscal horsepower of the vehicle (CVF), taking into account the type of fuel it uses. The tax campaign runs every year from April until the end of May or the beginning of June. National legislation sets minimum and maximum tax rates, but within this range each municipality is free to set its own. Municipalities can also grant reliefs depending on the type of fuel or propulsion system, for example for vehicles with environmental labels “0” and “ECO”. Historic vehicles and cars older than 25 years may also be exempt from IVTM.
The taxpayers are individuals and legal entities listed in the relevant registers as the owners of the vehicle as of 1 January of the tax year. Assessment and payment take place in the municipality where the vehicle is registered, which must coincide with the owner’s place of registration. In most cases, the tax amount ranges from 15 to 150 € per year.

Hydrocarbon tax (Impuesto sobre Hidrocarburos)

This is a special indirect tax (excise duty) on hydrocarbons, which applies only on the peninsula and the Balearic Islands. It does not apply to the Canary Islands, Ceuta or Melilla. A specific tax rate is set for each type of fuel. The Spanish government is striving to electrify the vehicle fleet and reduce dependence on fossil fuels, and therefore plans to increase the diesel tax so that its level approaches that of petrol.
In Catalonia there is an additional surcharge of 4.8 cents per litre of fuel, which provides around 215 million € in extra annual revenue. In addition, since 2022 Catalonia has applied a CO2 emissions tax on passenger cars and motorbikes if emissions exceed 120 g/km, and on trucks up to 3.5 tonnes if emissions exceed 160 g/km.

Insurance premium tax (Impuesto sobre las Primas de Seguro – IPS)

Since 1997, car insurance policies have been subject to an additional tax – the Insurance Premium Tax (IPS). Its current rate is 8%. Insurance services are exempt from VAT, but they are subject to other charges: the insurance premium also includes the contribution to the Insurance Compensation Consortium and the contribution to the Liquidation Commission of insurance entities.

Technical inspection fee (Inspección Técnica de Vehículos – ITV)

Vehicle owners in Spain are legally obliged to undergo regular Technical Inspection (ITV) at authorised stations. This is to ensure that vehicles in use meet minimum safety and environmental standards. Cars aged between 4 and 10 years from their first registration must undergo ITV every two years, and vehicles older than 10 years – annually. The amount of the fee varies from region to region, with the national average at around 32–35 €.

Toll roads

Currently, some Spanish motorways charge tolls for use. Toll sections are operated under concession, and the private companies responsible for their operation and maintenance collect the tolls from each passing vehicle.
The European Commission has recently issued an ultimatum to Spain, demanding that it introduce a general charge for the use of motorways and high-capacity roads so that the country complies with European rules on road tolls and vignettes (as in Austria, for example). Initially, the new system was due to come into force in 2024 with a charge of one cent per kilometre, but the government has not yet made progress in implementing this initiative.

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