Effective corporate taxation of cooperatives: assessment and quantification of tax benefits for the Spanish case

Abstract

Cooperative societies, as the main entities within the Social Economy, benefit from a specific tax framework theoretically designed to support their development and expansion. This study examines whether the current tax benefits fulfil their purpose of fostering the growth and competitiveness of these entities, identifying existing limitations and proposing recommendations to improve their tax regime. To this end, it reviews the applicable tax benefits (such as tax base reductions, tax credits and reduced tax rates), quantifies their impact and compares the results with those of other business structures using indicators such as the Effective Tax Rate. The results reveal that these benefits are unevenly distributed, mainly favouring larger cooperatives, while smaller cooperatives hardly benefit at all. Moreover, the overall impact of the fiscal framework is modest and does not serve as a significant driver of the sector's competitiveness. The article concludes by calling for a debate on the validity and scope of the differentiated tax regime, recommending its reform to make it more effective in supporting cooperative societies.