Archive for the ‘Spanish Tax residence and nationality’ Category

Spanish list of Tax Information Exchange Agreements

Monday, October 10th, 2011

Spain has signed TIEAs with the following territories: (more…)

Tax Agreement between Kingdom of Spain and the Commonwealth of the Bahamas

Friday, October 7th, 2011

The Tax Exchange agreement was published in the Spanish Gazzette the 15/7/2011

As per article 1, the agreement will facilitate that the competent authorities of the Contracting Parties shall provide assistance through exchanging information that is foreseeably relevant to the administration and enforcement of the domestic laws of the Contracting Parties concerning taxes covered by this Agreement. (more…)

WEALTH TAX MAKES ITS WAY BACK!

Tuesday, September 13th, 2011

The new Socialist candidate for the November 2011 presidential elections, Mr Rubalcaba, proposes to resurrect Wealth Tax. Please see our last posting on this topic at Taxprecision.com  Fortunately enough, his chances to win the elections are very limited, plus no other party will support such ridiculous measure. It is unfortunate that politicians use Taxes to win the elections instead as using them as wise macroeconomic vehicles to improve the economy. (more…)

European Commission vs Spain.- Transfer Tax on real estate companies

Tuesday, August 17th, 2010

The European Commission has been very active during the last years regarding Spanish Tax position when a non resident element is involved. Our posting today deals with a matter involving transfer tax and stamp duty in the context of M&A.

During the last decades, individuals acquiring Spanish property owned by a Spanish Company (SL)  have been forced to create a double company structure to own the shares of the Spanish company.

In many cases the two shareholders were based offshore and increased substantially the costs of owning property in Spain. The reason was that this acquisition will save the application of a real estate transfer tax which was extended to the disposal of shares.

Spain has been applying for many years a transfer tax charge of 6-7% for the disposal of shares of companies owning real estate assets in Spain. Interestingly enough, the application of this tax was not included in the Transfer Tax Act but in Law 24/1988 on the securities market.

Article 108 of Spain’s Law 24/1988 on the securities market establishes that a 6-7 percent transfer tax  (7 percent in most autonomous regions) applies to the transfer of securities of a company whose real estate assets in Spain represent more than 50 percent of its total assets, or whose assets include securities in another entity whose real estate assets in Spain represent at least 50 percent of its total assets, if the acquirer gains control of the real estate entity as a result of the transfer.

The European Commission has asked Spain to modify its transfer tax provisions relating to the acquisition of securities in real estate companies, arguing that the provisions are not consistent with article 5 of Council Directive 2008/7/EC concerning indirect taxes on the raising of capital.
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Gibraltar Road Toll and good neighborhood with La Linea

Monday, August 16th, 2010

Does La Linea’s mayor care about good neighborhood with Gibraltar?

It is a shame that some Spaniards tackle a XXI Century issue with XIV Century measures. See The Guardian article on the most ridiculous initiative from a local mayor we have seen in decades, the establishment of an international border road toll between Gibraltar and La Linea.

This issue is not an isolated one and unfortunately there are still some Spaniards not recognizing the sovereign rights of Gibraltar as determined by its people and the United Kingdom. The Spanish Socialist government has been advocating for dialogue with Gibraltar and the UK, however talks these days seem to be lost in translation.

Why is the Spanish Government so reticent to conclude a treaty with Gibraltar? why is Gibraltar not removed from the Spanish taxhaven blacklist?

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2010 OECD Model Tax Convention, Transfer Pricing and updated PE definition

Monday, August 9th, 2010

From the OECD site 22 July 2010 — The OECD Council today approved the 2010 versions of the OECD’s Model Tax Convention, the 1995 Transfer Pricing Guidelines and the 2008 Report on the Attribution of Profits to Permanent Establishments. The updates are the result of several years of work to improve these core OECD instruments in the area of international taxation.

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Spanish Economy, heading in the right direction according to IMF report

Sunday, August 1st, 2010

On July 30, 2010, the Executive Board of the International Monetary Fund (IMF)  issued its report on Spain.1 and welcomes the Government initiatives on Financial Institutions, deficit reduction and employment market reforms. Yes, Spain is going in the right direction, and this not just about Football!

The main challenge for the Spanish economy is not its financial stability, which is now clear after last weeks market reaction to the EU Banking stress tests, in which the Spanish Financial sector came as one of the strongest in the EU.

Ending the year 2010 with a public deficit of 9.3% is out of questions. The issue that the government must tackle is the paradigm shift from an economy relying on the construction industry toward improving innovation and the internationalization of the Spanish corporations, which is being primarily lead by the private sector as demonstrated by Banco Santander, BBVA, Abengoa, Telefonica and many other not so well known companies.

Summarizing, the IMF report restates the situation as perceived by most analysts and acknowledge the many challenges and the solutions. The IMF Board welcomes the government initiatives and suggests other necessary reforms. Overall, it seems from the report, what the Market has already understood, the Spanish Economy is heading in the right direction.

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Gibraltar & Spain, what’s going on?

Saturday, April 17th, 2010

We are surprised, happily surprised, to see Spain signing another TIEA. This one with Bahamas signed on March 11, 2010, follows the Netherlands Antilles, Aruba, Trinidad y Tobago agreements. Please see our Taxprecision post for more information.

When coming to Gibraltar, the question brings some political issues to the table which must be put aside as a matter of urgency.

The Spanish Tax legislation clearly discriminate Gibraltar by discouraging the furtherance of trade, commerce and business with this territory of the UK and part of the EU.

There are powerful economic reasons to end this situation. Gibraltar accounts for 3% of the exports in Andalucia, compared with a 4% with Morocco, or another 4% with Mexico or US. Gibraltar is, therefore, a strategic partner of Andalucia.

I can understand that a generation of Spaniards may still have some issues coming to terms with reality. I would like to invite my fellow Spaniards to rethink their position by reviewing our 2008 posting to get to know Gibraltar and more about its OECD compliance.

There are compelling reasons for the Spanish government to speed up the signature of this TIEA and remove Gibraltar from the list of Tax Havens as per Spanish RD1080/91.

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