#EmbraceSpain XXX: Expats as Brexit social problem

#EmbraceSpain XXX: Expats as Brexit social problem

Expats rights are the social challenge of Brexit and it is already included in the British political parties’ discourse even before negotiations and elections start.

This week at Del Canto Chambers we continue to work from our offices in the UK and Spain to strengthen the relations between both countries. In this way, over the weekend the Spanish newspaper El País published an article on the #EmbraceLondon Business Breakfast held on April 19th and in which we participated.

In this event, Leon Fernando del Canto stressed the usefulness of maintaining reciprocal trade relations between Spain and the United Kingdom with access to the Latin America and Middle East markets, as possible exchanges.

Amongst all the issues to be addressed in the Brexit negotiations, we find that one of the most important is the British and European expats rights on both sides of the Channel, since future visa, residence and immigration permits depend on it.

In this sense, our lawyer Julio Prieto has published an article highlighting the maneuvers of the British government to avoid an avalanche of applications for residence permits, offering foreign residents the option of subscribing to an online alert system “to receive by email all kinds of information, present and future, that they may need to regularize their situation“.

The discussion on the rights of these citizens will be one of the hottest in Brexit, to the point that the Labor party, already campaigning for the early elections, has announced that they will guarantee these rights of the EU citizens, while the EU authorities consider this one of their “red lines” in the imminent negotiations.

Meanwhile, Spain struggles to regain its lost influence in the European context, especially after the organization of the 3rd Southern European Union Countries Summit. A process that we analyzed in our blog with this post: “If Spain is to become a new power to be taken into account in Europe, it would be useful that this regained influence help foster consensus with its European partners, especially on controversial issues such as the expats rights abroad“.

Nonetheless, the Independent Authority for Fiscal Responsibility (AIREF) considers Income Tax collection forecasts in the State Budget (PGE) to be excessive, while on the other hand, a tax reduction is required to finance SMEs and a mixed model by the Autonomous Communities of 0.7% of the income tax destined to social aims.

In addition, in its tax collection effort, the Tax Office is sending out letters to taxpayers informing them about VAT inspections and it has also introduced a reform by which civil societies will be taxed as companies. Being an entrepreneur and a business person in Spain is more and more becoming a feat and a proof of great courage, with a government that, instead of offering support  and  facilitating and encouraging business and employment creation, is only interested in tax collection and in favoring large groups and companies, who are actually those with influence to keep them in power.

As Ramadan approaches and, with it, the most introspective time of the year in the Gulf countries, the Qatari government has estimated that the future VAT implementation would increase the country’s GDP by 2%. In addition, Qatar continues to strengthen its business contacts abroad with the signing of an economic and cooperation agreement with Russia.  It is also becoming a major hub for Islamic banking investments,  taking advantage of the worldwide boom of this sector in the financial market.

Del Canto Chambers is arriving to Colombia this week, a country with which we have several ties and interests, and where we have contacts with offices and groups interested in investing both in the UK and in Spain.

The Spanish government recently sent a trade delegation to Colombia, which was also attended by numerous Spanish businessmen with the aim of strengthening institutional, commercial and collaboration relations between both countries. Colombia’s economy has grown 1.6% and presents business opportunities, especially in foreign trade, reflecting a “positive trend … if taking into account that YE 2016 showed a slight recovery.”

Expats rights are the social challenge of Brexit and, as we defended in the #EmbraceLondon event, pragmatism should be the most appropriate way to tackle the negotiations for UK exit from the EU and to agree on a solution to the expats issue.

You can follow our opinion on the development of the international news in our blog and our social networks, such as Twitter, Facebook and Linkedin.

Xavier Nova (@xavinova)

Director at Del Canto Chambers

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