On April 26, the reform of the Sponsorship Law was approved by the Congress of Deputies, pending Senate approval. It is expected to come into effect on January 1, 2024, and it will be from this date that the tax incentives provided by this reform would take effect.
Silverio Agea, general director of the Spanish Association of Foundations (AEF), points out that "we at the AEF congratulate ourselves for the support of the political parties to this reform, which was much needed"
Eugènia Bieta, president of the Catalan Foundations Coordinator values the reform as "a clear advance that recognizes and incentivizes the effort and commitment of civil society to philanthropy".
The text of this reform seeks to modernize and replace the previous legislation in this area by incorporating new tax incentives for sponsorship and updating existing ones.
In the current legal framework, it is regulated by Law 49/2002, which updated Law 30/1994 on Foundations and Tax Incentives for Private Participation in Activities of General Interest, the first to incorporate the term 'sponsorship' after four failed modification attempts. The novelties introduced in Law 49/2002 are:
Micro-sponsorship is encouraged and deduction percentages are increased: for individuals, the base on which 80% of the donation for Personal Income Tax can be deducted is raised from 150 to 250 euros, and for the rest, there will be a 40% deduction (instead of the current 35%). For legal entities, deductions in Corporate Tax also increase from 35% to 40%. In both cases, to reward sustained sponsorship, the deduction increases to 45% for individuals and 50% for legal entities (both now at 40%) if, in the two previous years, the donation to the same entity has been made for at least the same amount.
The concept of donations and gifts is updated, incorporating service donations (advisory and consultancy services, advertising spaces in media, donations for the architectural rehabilitation of cultural heritage and donations of protected natural spaces or cultural goods by recognized authors, and all kinds of property use assignments). This way, it aligns with other European legislations that define sponsorship beyond a simple economic transaction.
Recognition or reward sponsorship is included allowing the donor to receive symbolic returns in the form of goods or services, provided they do not exceed 15% of the donation value with a maximum limit of 25,000 euros.
The types of tax-exempt economic activities are expanded when carried out by non-profit entities, in the following activities: development and innovation, social and labor insertion services for people at risk of social exclusion, and teaching and professional training linked to high-capacity students.
The automatism to apply tax exemptions for local tax on non-profit entity assets is strengthened.
For Eugènia Bieto, president of theCatalan Foundations Coordinator, "this reform is great news for the foundation sector and, although it is not as ambitious as we would have liked, it is a clear step that recognizes and incentivizes the effort and commitment of civil society to philanthropy, which will undoubtedly help increase the resources of foundations and other Third Sector entities".
On the other hand, Silverio Agea, general director of the Spanish Association of Foundations (AEF), notes that "we at the AEF congratulate ourselves for the support of the political parties to this reform, which was much needed", he ensures "It is important to acknowledge the work carried out by Third Sector organizations, which are a vibrant, diverse, and plural fabric, a reflection of our society, and also of those who fund them, civil society. Now we must disseminate this reform so that all members of society, citizens, and companies, commit to sponsorship and philanthropy".
Satisfacció per l'aprovació de la reforma de la Llei del Mecenatge