Resumen de Exploring the predictive capacity of real estate sector indicators in forecasting regional tax revenues on Real Property Transfers (RPTT) and Stamped Legal Documents (STD)

José María Piñero Campos, Camino González Vasco

• This paper contributes to the empirical literature on the development and estimation of a forecasting model for Real Property Transfers (RPTT) and Stamped Legal Documents (SLD) tax base at regional level focusing on the study of real estate sector indicators. We propose two kinds of ARX models to estimate this tax base.

  Firstly, we test whether the number of annual approvals for new residential constructions is a good predictor or the annual RPTT and SLD tax base for each Spanish autonomous community over the period 1992– 2018. Secondly, we extend the number of real estate indicators considering monthly data from Mortgage Statistics and the Statistics on Transfer of Property Rights provided by the Spanish National Statistics Institute. These indicators are found to be significant determinants of the tax base for every region. Applying the corresponding tax rate to the estimated tax base, we obtain the prediction for the tax revenue.

  Results of the backtesting exercises show that both annual and monthly models successfully predicts the evolution of the actual RPTT and SLD tax revenues for every region and illustrate its usefulness as a tool for regional revenue forecasting.