Saturday, September 25

Barcelona may charge the IBI to the Catholic Church for renting a building

The contentious-administrative court number 8 of Barcelona has given the reason to the Barcelona City Council so that it can collect the Real Estate Tax (IBI) from the Institute of Religious of Our Lady of Mercy that rented a building of its property to the educational company Saint Nicholas School Barcelona SL, according to the order to which elDiario.es has had access. The congregation will have to pay 22,368 euros as IBI for the year 2019 corresponding to the property of its ownership from which it received income derived from the rent.

The Consistory, for its part, maintains that this is “the first time” that justice has pronounced in favor of the collection of municipal taxes to the church for the fact of receiving economic returns from its patrimony.

The congregation filed an administrative appeal against the liquidation, which on July 5, 2021 was dismissed by the Councilor for Commerce, Markets, Consumption, Internal Regime and Finance of the Barcelona City Council. The religious entity appealed to the Justice, which issued this ruling on July 22.

The Consistory defends that the congregation is registered in the Economic Activities Tax (IAE) for being carrying out an activity for which it receives an economic return and, for this reason, it has to pay the IBI.

The religious congregation alleged that by allocating this place to a teaching activity, it was included in the reasons for exemption from IBI included in the Law that regulates the tax regime of non-profit entities and in the Concordat between Spain and the Holy See of 1979.

The contentious-administrative court that has resolved the case considers that who exercises the teaching activity is a commercial company and what the congregation does is rent the space. Therefore, the congregation has to pay the local IBI because it carries out an economic activity, not an educational one.

Barcelona City Council considers it’s a statement that the criteria followed in this judgment would be applicable to all types of religious confessions, non-profit organizations and associations declared of public interest.

It points out that activities compatible with EU competition law must be excepted, as in the case of certain activities in the field of education, health, social services, culture, as well as religious and conservation of the Historical Heritage.



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