In the Canary Islands, entrepreneurs are subject to a series of taxes that affect their business operations. These taxes vary depending on various factors such as the type of business, the volume of income, and the legal structure of the company. In this article, we will explore the types of taxes that entrepreneurs must pay in the Canary Islands and how these affect their net profits.

Types of Taxes:

1. Corporate Income Tax (CIT): This tax applies to corporations and other legal entities resident in the Canary Islands. The standard tax rate is 25%, although there are certain deductions and tax exemptions available for specific business activities.
2. General Indirect Canary Islands Tax (IGIC): Similar to the Value Added Tax (VAT) in the rest of Spain, IGIC is an indirect tax that levies the consumption of goods and services in the Canary Islands. Tax rates vary depending on the type of goods or services, with a standard rate of 7%, a reduced rate of 3%, and a super-reduced rate of 0%.
3. Personal Income Tax (PIT): Individual entrepreneurs in the Canary Islands are subject to PIT, which taxes income earned from their business activities. Tax rates vary based on income levels, with progressive brackets ranging from 19% to 23%.

Percentage of Profits for the State:

The percentage of profits that the state receives from the taxes paid by entrepreneurs in the Canary Islands depends on various factors, including the level of economic activity in the region and the efficiency in tax collection. In general, the state can obtain a significant portion of tax revenue through direct and indirect taxes, thus contributing to the funding of public services and the economic development of the region.

In summary, entrepreneurs in the Canary Islands must take into account several taxes that affect their business operations, including Corporate Income Tax, IGIC, and Personal Income Tax. The percentage of profits that the state receives from these taxes contributes to the functioning and sustainability of the local economy.