Purchasing your own car in Spain is an important and exciting event. To avoid any unpleasant surprises from owning a vehicle, it is important to remember the associated taxes and pay them on time.

For car owners in Spain, there are several types of taxes associated with the ownership and operation of vehicles.

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The main taxes of a car owner include:

1. Impuesto sobre Vehículos de Tracción Mecánica (IVTM) – transport tax.
2. Impuesto de Matriculación – vehicle registration tax.
3. IVA (Impuesto sobre el Valor Añadido) – value added tax when purchasing a new car.
4. Impuesto sobre Hidrocarburos – excise tax on fuel. 

Let’s take a closer look at each of them.

Transport tax (Impuesto sobre Vehículos de Tracción Mecánica – IVTM)

What is the amount of transport tax and what does it depend on?

The Vehicle Tax (IVTM) is annual and is levied by local municipalities. The amount of tax depends on the following factors:

• Engine power: The higher the engine power, the higher the tax.
• Vehicle type: Cars, motorcycles, trucks, buses, etc.
• Engine Size: Particularly important for motorcycles and other small vehicles.
• Vehicle age: Some municipalities offer incentives for older vehicles. 

Approximate tax rates for passenger cars may vary as follows:

• Cars with engine power up to 8 horsepower: from 12 to 25 euros.

In the province of Alicante – 12.62.

• Cars with engine power from 8 to 11.99 horsepower: from 30 to 60 euros.

In the province of Alicante – 34.08.

• Cars with engine power from 12 to 15.99 horsepower: from 60 to 120 euros.

In the province of Alicante – 71.94.

• Cars with engine power from 16 to 19.99 horsepower: from 80 to 150 euros.

In the province of Alicante – 89.61.

• Cars with an engine power of more than 20 horsepower: from 110 to 250 euros and above.

In the province of Alicante – 112.00.

The exact rates are set by local authorities, so the amount of tax may vary significantly depending on the region of Spain.

Vehicle registration tax (Impuesto de Matriculación)

Vehicle registration tax is charged when purchasing a new car or when importing a car from abroad. In Spain, they pay great attention to environmental issues and the tax rate depends on the level of CO2 emissions:

• Cars with CO2 emissions less than 120 g/km: exempt from tax.
• Cars with CO2 emissions between 121 and 159 g/km: 4.75% rate.
• Cars with CO2 emissions between 160 and 199 g/km: 9.75% rate.
• Cars with CO2 emissions over 200 g/km: rate 14.75%. 

VAT (Impuesto sobre el Valor Añadido – IVA)

When purchasing a new car in Spain, VAT is charged at the standard rate of 21%. It does not need to be paid separately: this tax is included in the price of the car. 

Excise tax on fuel (Impuesto sobre Hidrocarburos)

Excise duty on fuel (petrol and diesel) is another important tax for car owners. Rates vary by fuel type and may vary regionally. 

Changes for car owners in Spain in 2024

In 2024, there were some changes in tax laws affecting car owners:

• Increase in vehicle tax rates (IVTM): Some municipalities are planning to revise tax rates upward, especially for vehicles with high CO2 emissions and powerful engines. This trend has emerged not only in Spain, but throughout the EU.
• Strict environmental regulations: Additional tax incentives have been introduced for owners of electric and hybrid vehicles with low CO2 emissions.
• Update of excise taxes on fuel: In connection with global efforts to reduce greenhouse gas emissions, it is planned to increase excise taxes on diesel fuel. Such changes are aimed primarily at promoting the use of environmentally friendly vehicles and reducing the overall level of CO2 emissions in the country.

To summarize, we note that car owners in Spain are required to promptly pay a number of taxes associated with the ownership and operation of vehicles, including transport tax, registration tax, VAT on the purchase of a car and excise tax on fuel.

The amount of these taxes depends on the vehicle’s characteristics, such as engine power and CO2 emissions. In 2024, there were changes to tax laws aimed at increasing rates for high-emission vehicles and encouraging the use of cleaner vehicles.

We hope our article was useful to you and nothing (even taxes) can overshadow your comfortable vehicle ownership.