Fundalib Brings Justice to Europe’s “Tax Hell”

Imagine living in a country where inheriting your family home could lead to financial ruin. For decades, this was the reality for millions of Spaniards.

Entrepreneurs and ordinary citizens alike faced uncertainty about their financial futures, with Spain earning a reputation for high taxation, even among European Union countries. The inheritance tax was particularly devastating, forcing many low-income Spaniards to sell their inherited childhood homes just to pay the levy, often leaving them worse off than before.

In 2015, Roxana Nicula and her husband Juan Pina founded Fundación para el Avance de la Libertad (Fundalib), or “Foundation for the Advancement of Liberty.” Their mission was to promote individual human freedom in all its aspects, with an eye on addressing the burdensome inheritance tax that was causing significant hardship for Spanish families.

"One would think taxes are just numbers, not emotions," said Roxana, president of Fundalib. "But as you dig in, stories are unveiled of ordinary people under an unbearable burden."

For years, Fundalib worked with Spanish policymakers to address the dysfunctional tax system, proposing solutions that would ensure a fairer and more competitive tax landscape across the country. This is a particularly daunting task as Spain is divided into 19 subdivisions that retain a significant degree of autonomy over their own tax policies.

Fundalib’s efforts ramped up in 2017 with the launch of their flagship initiative: the Regional Tax Competitiveness Index (IACF). In close collaboration with the U.S.-based Tax Foundation, this annual publication measures and ranks regions across the country based on the relative rates of numerous taxes. Also included are Fundalib’s tax policy reform recommendations for each region.

Thanks to the high quality of Fundalib’s analysis and their successful marketing of the index, the IACF is now widely regarded as an important tool for policymakers across the country, even those usually hostile to classical liberal ideas. The presentation of each new edition is now attended by high-level national officials and regional tax ministers, and, for the last two years, the senate has welcomed the report’s annual launch event at the Palace of the Senate, a rare honor for private events like this.

Juan Pina, secretary general of Fundalib, explained that the IACF guides the national conversation on tax issues. "The index is a powerful tool for regional decision makers,” he said. “Many regional finance ministers comment on the index, are questioned about it in parliament, and attend our events. Most regional governments now look at our report before making any tax policy decisions."

Since its inception, the IACF has led to over 30 policy wins in 13 out of 19 tax territories, benefiting approximately 63% of the Spanish population. Spain’s Extremadura region, which once had the highest wealth tax in the world, has now abolished it entirely. At the launch of the 2024 IACF, Extremadura’s finance minister acknowledged that this tax repeal was a result of Fundalib’s work.

The impact has been particularly notable for its influence on the inheritance tax. Eight regions have either eliminated or significantly reduced the inheritance tax for immediate family members. As a result, the number of vulnerable people renouncing their inheritance due to an inability to pay the tax has decreased from over 40,000 per year to virtually zero in the affected regions.

Perhaps most importantly, citizens no longer face the agonizing decision of selling inherited family homes just to pay exorbitant taxes, preserving family wealth and stability across generations.

"It is safe to say that over thirty million Spaniards have benefitted from policy reforms induced by our annual index, from tiny ones to really large ones," Roxana said. Fundalib estimates that taxpayers saved over one billion euros in 2023 alone.

Roxana’s personal experience growing up in communist Romania and witnessing her great-grandmother's joy at reclaiming confiscated land instilled in her a deep appreciation for property rights.

"I came to Spain long ago, but I was originally from Romania, a country devastated by communism at the time. I will never forget my great grandmother Safta kneeling to kiss her recovered land after the dictatorship and saying 'without property you're deprived of your own dignity,'" Roxana recounted.

Fundalib's partnership with Atlas Network played a crucial role in amplifying their impact. Atlas Network provided vital support through grant funding, professional development training, and opportunities to network and collaborate with other partner organizations, each of which empowered Fundalib's to work independently, systematically, and effectively. This support enabled Fundalib to develop and refine their advocacy strategies, turning them into powerful tools for change.

As Fundalib continues its work, Roxana says the organization remains committed to promoting human dignity and freedom through tax policy reform. "Our work at Fundalib ensures that wealth and property rights remain now mostly in the hands of their rightful owners, not in those of the government."