Capital taxes (D.91)

4.148 Definition:

Capital taxes (D.91) consist of taxes levied at irregular and very infrequent intervals on the values of the assets or net worth owned by institutional units or on the values of assets transferred between institutional units as a result of legacies, gifts inter vivos or other transfers.

4.149 Capital taxes include:

  1. taxes on capital transfers: inheritance taxes, death duties and taxes on gifts inter vivos, which are deemed to be levied on the capital of the beneficiaries (except taxes on sales of assets, as these are not transfers);
  2. capital levies: occasional and exceptional levies on assets or net worth owned by institutional units . These include betterment levies, that is taxes on the increase in the value of agricultural land due to planning permission to develop the land for commercial or residential purposes.

4.150 Taxes recorded in the accounts may be derived from two sources: amounts evidenced by assessments and declarations or cash receipts.

  1. If assessments and declarations are used, the amounts shall be adjusted by a coefficient reflecting assessed and declared amounts never collected. As an alternative treatment, a capital transfer to the relevant sectors could be recorded equal to the same ajdustment. The coefficients shall be estimated on the basis of past experience and current expectations in respect of assessed and declared amounts never collected. They shall be specific to different types of taxes.
  2. If cash receipts are used, they shall be time-adjusted so that the cash is attributed when the activity took place to generate the tax liability (or when the amount of tax was determined). This adjustment may be based on the average time difference between the activity (or the determination of the amount of tax) and cash tax receipt.

4.151 In the system of accounts, capital taxes are recorded:

  1. among changes in liabilities and net worth (-) in the capital account of the sectors in which the taxpayers are classified;
  2. among changes in liabilities and net worth (+) in the capital account of general government;
  3. among changes in liabilities and net worth in the capital account of the rest of the world.