As of the end of 2022, the Spanish Tax Agency is managing a backlog of over 230,000 claims, accumulating a debt of €40.42 billion.

This figure does not include an additional €12.15 billion in indemnities the state is liable for due to unfavorable judicial rulings.

Íñigo Fernández de Mesa, President of the Institute of Economic Studies, discussed these challenges during a press conference where he presented the report "The Problem of Tax Litigation in Spain: Proposals for Solutions and Improvements from the Corporate Perspective." This report, compiled by a panel of seventeen experts including prominent financial and tax law professors, highlights the serious implications tax litigation has on Spain's competitiveness.

The report emphasizes the need for implementing alternative measures aimed at facilitating quicker conflict resolution with the tax authority while ensuring efficiency, simplification, and legal certainty.

According to the analysis, nearly a quarter of appeals were resolved entirely in favor of taxpayers, while approximately 26% were deemed completely valid under economic-administrative procedures.

Of the rejected appeals at this stage, about 32% were ultimately favored in the contentious-administrative jurisdiction.

This data indicates that over 60% of the total challenged tax assessments are fully accepted, pointing to underlying issues within the administration that contribute to increased litigation.

The current tax litigation accounts for nearly 21% of the total revenue collected by the tax authority in the specified year, underscoring the complexity and scale of the ongoing situation.

The report identifies significant discrepancies between the interpretation and application of tax regulations by the administration and taxpayers, revealed during audits and investigations carried out by the tax agency.

Experts also noted that the current penalty framework exacerbates litigation.

The system often enforces penalties almost automatically for payment failures without considering minor errors absent of fraudulent intent that could exempt individuals from such penalties.

In a relevant ruling, the Supreme Court, in its decision number 520/2025 dated May 7, 2025, restated that penalties cannot be applied automatically in cases of tax payment failures.

The administration is required to establish and substantiate the taxpayer's culpability, reaffirming the presumption of innocence as stated in Article 24.2 of the Constitution, consistent with established jurisprudence.