Royal Decree-Law 18/2019 is published today in the BOE, which includes 10 key labor and tax measures
Royal Decree-Law 18/2019, of December 27, which adopts certain measures in tax, cadastral and social security matters, comes into force tomorrow Sunday, December 29, 2019.
The 10 key measures it incorporates
Among the measures incorporated in the Royal Decree-Law are the following:
1.- The 2019 SMI is initially extended in 2020
Extension of the validity period of Royal Decree 1462/2018, of December 21, which sets the minimum interprofessional wage for 2019.
Until the RD establishing the minimum interprofessional wage for 2020 is approved within the framework of social dialogue, the effects of Royal Decree 1462/2018, of December 21, establishing the minimum interprofessional wage for 2019, are extended.
We remind you that the 2019 SMI for any activity in agriculture, industry and services, regardless of the sex or age of the workers, is set at 30 euros/day or 900 euros/month, depending on whether the salary is set by day or by month.
2. Self-employed. Objective estimation method
The quantitative limits that delimit the scope of application of the objective estimation method for economic activities included in the scope of application of the method in Personal Income Tax are extended for the 2020 tax period.
The only exception is agricultural, livestock and forestry activities, which have their own quantitative limit based on income volume.
Specifically, with effect from 1 January 2020, the thirty-second transitional provision of Law 35/2006, LIRPF, is amended as follows:
«For the years 2016, 2017, 2018, 2019 and 2020, the amounts of 150,000 and 75,000 euros referred to in section a') of letter b) of rule 3 of section 1 of article 31 of this Law are set at 250,000 and 125,000 euros, respectively.
Likewise, for said exercises, the amount of 150,000 euros referred to in letter c) of rule 3 of section 1 of article 31 of this Law is set at 250,000 euros.
3. VAT
Similar to the previous measure, the limits for the application of the simplified regime and the special regime for agriculture, livestock and fishing in the Value Added Tax are extended for the 2020 tax period.
4. Temporary reinstatement of the Wealth Tax
With effect from 1 January 2020, the second section of the sole article of Royal Decree-Law 13/2011, of 16 September, re-establishing the Wealth Tax on a temporary basis, is amended.
It is worded as follows:
«With effect from 1 January 2021, the following amendments are introduced to Law 19/1991, of 6 June, on Wealth Tax:
Article 33 is amended to read as follows:
“Article 33. General bonus on the full amount. A 100 percent bonus will be applied to the full amount of the tax for taxpayers with a personal or real obligation to contribute.”
Two Articles 6, 36, 37 and 38 are repealed.
5. Pensions are frozen (pending a government)
Social Security pensions, pensions for State Pensioners, pensions under special war legislation and other State public benefits will maintain the same amount as they were recognized on December 31, 2019.
It is established, however, that once the corresponding regulation is approved (when there is a Government), the revaluation of pensions and other public benefits will take effect from January 1, 2020.
6. Types and bases of Social Security contributions for 2020
The amounts of the maximum limit and the maximum contribution base in the Social Security system established in article 3 of Royal Decree-Law 28/2018, of December 28, are extended for the time being.
(NOTE: We remind you that art. 3 of RD-Law 28/2018 established the following):
During 2019, the maximum amount of the Social Security contribution base in those regimes that have established it and the maximum contribution bases applicable in each of them, is set at 4,070.10 euros per month.
7. Quotation rules
Order TMS/83/2019, of January 31, which develops the legal regulations for Social Security contributions, unemployment, protection for cessation of activity, the Salary Guarantee Fund and vocational training for the year 2019, is extended.
It is expressly established that as long as it does not oppose the provisions of this RD-Law, in terms of contributions to Social Security, the application of the Order TMS/83/2019, of January 31.
8. Reduction of contributions due to a decrease in accidents
The application of the system of reduction of contributions for occupational contingencies is suspended for companies that have significantly reduced occupational accidents, provided for in Royal Decree 231/2017, of March 10, for contributions generated during the year 2020.
9. Extension of the deadline for repayment of loans granted to Social Security
The deadline for the cancellation of the loan granted to Social Security by the State, as referred to in Article 12.3 of Law 49/1998, of December 30, on the General State Budget for 1999, is extended by 10 years, starting in 2019.
10. Safeguard clause
NOTE: The so-called “safeguard clause” is a legal guarantee agreed between unions, employers and the Government at the time, which guaranteed that those people who had been dismissed before the new law came into force could retire with the requirements in force at that time, or later as a result of EREs prior to it.
The Royal Decree-Law establishes during 2020 the maintenance of the regulations prior to Law 27/2011, of August 1, on updating, adaptation and modernization of the Social Security system, for certain groups whose employment relationship was terminated before 2013.
It is established that the regulation of the retirement pension, in its different modalities, access requirements, conditions and rules for determining benefits, in force before the entry into force of Law 27/2011, of August 1, will continue to apply to retirement pensions that are accrued before January 1, 2021 in certain cases.
These include the case of persons whose employment relationship was terminated before 1 April 2013, provided that after that date they are not included again in any of the Social Security system regimes.
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