Gibraltar dismisses Spain's ‘fanciful' tax claims

 

The Spanish Government's claim that Gibraltar costs Spain EU 1 Bln per year in lost tax revenue has "no basis in reality or fact and represent no more than a financial flight of fancy", the Gibraltar Government said yesterday.

The Government of Gibraltar was responding to comments made by Spain's Secretary of state for Europe, Iñigo Méndez de Vigo, in an interview with ABC newspaper.

In a statement, the Gibraltar Government said the comments were designed to keep the Gibraltar story alive "…with further prejudicial language that is not representative of the reality of the situation."

It said Sr Méndez de Vigo had asserted the figure as factual when it was nothing but "a wild estimate" that sought to add credibility to Spain's claim's about the financial services centre but could not be justified in any way.

To back its argument, the Gibraltar Government said that of the 15,673 active companies registered in Gibraltar, only 66 had Spanish nationals living in Spain as shareholders.

"This helps to clearly demonstrate that Gibraltar is, unsurprisingly, not seeing significant numbers of Spanish individuals using Gibraltar's financial services," the statement from No 6 Convent Place said.

"Moreover , Gibraltar's Income Tax Act 2010 has, after minor amendments by the current administration, been approved by the Code Group of the EU with only Spain not approving it."

"That demonstrates that the relevant Gibraltar legislation fulfils all the criteria required by Brussels in this respect, although Spain is continuing its attempt to ensure our law is nonetheless found to fall foul of the requirements [and] a state-aid investigation is still under way."

The Gibraltar Government also said Spain had failed to take into account the "considerable" revenue lost by Gibraltar as a result of businesses in Spain operating in competition with local companies while not registering for PAYE, social insurance or tax purposes.

It said many local residents also bought goods in Spain and brought them into Gibraltar without paying duty.

"The fact is that the calculation Spanish Government officials and politicians should be doing is to value what Gibraltar contributes to the Spanish economy today," said Chief Minister Fabian Picardo.

"Apart from the jobs we already create for the region and the saving on unemployment benefits there are also the salaries that flow from Gibraltar to Spain, the social insurance set-offs, the spending of Gibraltar residents in Spain and the supply to Gibraltar businesses of goods and services."

"This is a huge amount the central Government in Madrid will not contemplate, even though it is reduced by the negative climate created by the present Government's attitude to Gibraltar."

"These synergies could grow for mutual benefit and could easily net Spain over a Billion Euros or more a year in benefit alongside great job-creation strategies for the whole area if the Partido Popular moved on from its medieval hang-ups on Gibraltar and started to work with us for the economic good of all in the region."

"Sr Mendez de Vigo would therefore do better to concentrate on that sort of co-operation with Gibraltar and move on from just bashing the Rock in August, which is fast becoming one of the hallmarks of this PP administration."

"It does nothing the for the thousands of unemployed in the region who deserve better from their elected politicians."

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