Spain’s Supreme Court clarifies the limits of enforcement surcharge:  Late-payment interest cannot be charged on the same debt

The case originated before the Catalan Tax Agency, where a company requested instalment payment of a gambling tax assessment. After the request was denied, the company filed an economic-administrative appeal and sought suspension of enforcement while the debt was already in enforcement. Years later, the administration charged late-payment interest under Article 26.2.c of the General Tax Law, despite having already applied the 5% enforcement surcharge under Article 28.2. The taxpayer successfully challenged this decision before the Regional Economic-Administrative Court and the High Court of Justice of Catalonia, leading the Government of Catalonia to appeal to the Supreme Court.

The Supreme Court admitted the appeal due to its cassational interest, focusing on whether late-payment interest linked to a suspension could be imposed together with the enforcement surcharge if the debt was already in the enforcement period at the time the suspension was granted.

The Third Chamber held that charging both amounts is not allowed. Its reasoning was based on two principles. First, late-payment interest and the enforcement surcharge share the same compensatory purpose: to indemnify the public treasury for the financial impact of late payment, not to punish the taxpayer (in line with Constitutional Court Judgment 76/1990). Second, applying both for the same period would result in double compensation for a single harm, contrary to the principles of tax justice and proportionality.

The Court emphasised that once a debt enters the enforcement period, the surcharge replaces late-payment interest from that point onward. This interpretation is expressly supported by Article 28.5 of the General Tax Law, which excludes late-payment interest accrued from the start of the enforcement period when the enforcement or reduced surcharge applies.

The ruling has important practical effects. For tax authorities, it sets a clear limit: no late-payment interest linked to a suspension may be charged once the debt is in enforcement. For taxpayers, it prevents the accumulation of ancillary charges that could become disproportionate. For courts and economic-administrative bodies, it provides a uniform interpretative standard that helps reduce future disputes.

Ultimately, the decision is grounded in tax equity, stressing that effective tax collection must be balanced with fairness and proportionality. By rejecting double charging, the judgment enhances legal certainty in the Spanish tax system.

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Marta Cabezón is an economist (University of Málaga) with a master’s degree in corporate tax (ESESA). She is a tax and corporate advisor on the Costa del Sol, fluent in English, specialising in international taxation and double-tax treaties, as well as a court-appointed expert in loss-of-profit valuations. Marta is a member of the Official College of Economists of Málaga and the Association of Judicial Experts of Spain.