Gibraltar & Spain, what’s going on?
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.
What is preventing Spain, UK and Gibraltar to finalize this TIEA?
Prime Minister Caruana and Spanish Minister Moratino have declared that the TIEA draft is almost ready for signature. Why is this not happening. The TIEA is not a complex document and its model has been already approved by all parties. It is just a matter of signing it.
From and International Law point of view the Treaty could be signed in the UK or by express delegation of the UK Government. Alternatively the Tripartito could be used to honor all parties. It is interesting to note that the US-Gibraltar agreement was signed under the US and Gibraltarian flags without the UK being present. We would like to see that happening too between Spain and Gibraltar, but understand it is giant step.
Gibraltar is a territory of the United Kingdom, is part of the European Union and complies fully with the OECD provisions. Gibraltar has signed TIEAs with US, UK, Belgium and Portugal among others.
It is about time, in the XXI Century, to come to terms with the fact that Gibraltar can represent itself in the international arena.
It is about time for Spain to amend the old RD1080/91 and remove Gibraltar, as a territory of the EU and being an OECD cooperative territory.
This will end the unfair discrimination against Gibraltar which is discouraging the furtherance of trade, commerce and business between Spain and Gibraltar and affecting the economy of the Campo de Gibraltar. If we consider that Gibraltar accounts for 3% of the exports in Andalucia, compared with a 4% with Morocco, or another 4% with Mexico or US, the importance of Gibraltar as a trading partner must be recognized.
From these pages we make another call for the TIEA to be signed sooner