Double taxation in the succession agreements: determination of the acquisition value of assets transferred before death

Right of succession

Abstract

The taxation of capital gains revealed on the occasion of lucrative transfers has been modificated on the occasion of the entry into force of Law 11/2021, on the prevention of fraud. And, under the argument of an alleged fraudulent intention, the Constitutional Court endorses the legitimacy of a different tax treatment for capital gains arising on the occasion of an inheritance or as a result of a transmission by succession agreement of "apartamiento". The controversy raised by this different treatment of similar economic capacities calls into question whether this legislative amendment is contrary to the provisions of article 31.1 of the Spanish Constitution, not only because of the different tax treatment conferred on a capital gain generated in civilly similar situations, but also because of the obligatory nature of taxation of presumed profits,  contrary to the principle of economic capacity, which enshrines the entire tax system.