Aug
14
Business Over Tapas
Filed Under EN
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Housing:
‘Prime minister Mariano Rajoy’s announcement that pensioners are to lose their automatic exemption to Capital Gains Tax when selling homes has sent shock-waves through the ex-pat population. As part of a package of economic and financial reforms, the Premier said the tax break for people over the age of 65 would only remain if they bought another property or invested in a bank-led ‘pension’ scheme…’. From the Round Town News. The Expat Forum is running a thread on the story from last week about the increased rate of plusvalía tax for pensioners who sell their home here. With the way of forums, it is not easy or recommended to follow all that is posted, but there may be nuggets! The original story is at El País: over 65’s will not pay plusvalía – capital gains tax – if they invest their earnings in pension funds…
However, from Citizen Advice comes: ‘Despite the headlines in a free regional newspaper yesterday, the government has no intention of removing the exemption from capital gains for over 65′s when they sell their home. Under the existing law, anyone over 65 who sells their home (defined as their main residence for the last 3 years), is exempt from capital gains tax. The draft tax legislation that was published last month did not contain any amendments to this aspect. This misunderstanding is quite widespread, and I answered an email on our website last month from a member who was told by her Spanish lawyer that this was the case…’.
‘Yet another survey finds Spain remains the top choice for U.K. pensioners, but their attention is wandering. Of the U.K. adults who said they would retire overseas, 50 per cent said they were planning to retire outside Europe, with the U.S. the top choice, according to MGM Advantage, the financial planning company that released the survey. In total, more than 6 million U.K. adults are planning to retire outside their home country, with 3.2 million eager to spend their golden years somewhere other than Europe. Of those who want to stay on the continent, 26 per cent are targeting Spain, with France the second choice with 17 per cent, followed by Italy at 10 percent…’. From Mark Stücklin’s Spanish Property Insight.
The TVE documentary from ‘Comando Actualidad’ called ‘Mi Casa es Ilegál’, now has a permanent home here.
With a few here and a few there, the Partido Popular reckon that the Junta de Andalucía, run by the PSOE and the IU in a sometimes uneasy coalition, have ‘regularised’ in the past two years just two hundred of the 300,000 ‘illegal’ homes which, taken together, are about the same number of dwellings as can be found in the City of Málaga. The leader of the PP in Andalucía, Juan Manuel Moreno, says he will be meeting with some of the various owners’ groups in the weeks to come, together with the mayors of the most affected towns, to ‘try and find answers’. Could we maybe suggest one? El Mundo, which has the story, adds: ‘…Moreno has also invited the new Secretary General of the PSOE, Pedro Sánchez, to see at first-hand “the disorder and urban chaos” of the Government of Susana Díaz.
“He will already know of the naked ambition of the President of the Junta and he should also be made aware of the other side of Díaz: her absolute inability to manage the interests of Andalucía and to solve their problems”…’. That may not be the way to get things changed.
June sales of homes was up by 8.8% over the same month last year, at 26,076 operations.
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Tourism:
Is the future Paramount Park to be raised in Murcia partially located on public land and is the local ecologist group going to try and put the skids on it? You know they are. The local ‘Ecologistas en Accion’ from Alhama have sent the appropriate paperwork to the Superior Court in Murcia claiming that 20% of the future amusement park is within a Parque Natural (specifically, the Parque Regional de Carrascoy-El Valle). Unemployment in Murcia is currently at a trim 25%. More here.
‘Wearing only underwear and angel wings, three young women wiggle their hips to entice customers to enter one of the many nightclubs in Magaluf, a Spanish beach resort notorious for its sex and booze excess. “We came to get drunk, basically. Everyone knows Magaluf is partying big time,” said Bruce Stenning, an 18-year-old from London who came to the Mediterranean island of Majorca with five friends. … Roughly 85 percent of the visitors to Magaluf come from Britain and Ireland, and little Spanish can be seen on bar flyers and billboards offering cheap drinks and theme parties…’. From Rappler.
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Finance:
‘Since the beginning of the current crisis, Spain has fallen by fourteen places in the UN human development index. From 2008 to 2013, our country has moved from 13th place to 27. This index measures the well-being of countries taking into account aspects such as health, education and inequality, in such a way that these factors provide further information on the development of a country beyond the simple data from the gross domestic product (GDP)…’. From El Diario, which adds that the average wage in Spain has fallen since 2010.
‘Spain’s miraculous economic recovery is a mirage, a collective delusion concocted in the fevered but highly imaginative minds of government ministers, economists and accountants, and then projected on to the mass consciousness as official reality. When it comes to creative accounting, few can hold a candle to the country’s finance minister Cristobal Montoro…’. From an article appearing in June on Spain’s fiddled numbers, at Wolf Street.
(Wolf Street talking here about Spain’s youth): ‘…As for job security, there is none: nine out of ten new job contracts are temporary and in most professional sectors the proportion of temporary contracts is already double the EU average.
What’s more, over 40% of young Spanish workers are overqualified for the jobs they hold, while eight out of ten millenials (that is, those aged between 16 and 30) continue to live with their parents. As for the lucky, brave few who strike out on their own, most of them must cough up more than half of their income on rent, even for shared accommodation.
This is just a little taste of the grim reality facing Spain’s lost and betrayed generation. But it’s not the only reality vying for attention; there is also the government’s version of events:
in the government’s alternate reality, things could not be rosier. “We are on solid ground,” Rajoy recently said. “The recovery is here for good.”…’.
The end of a long article in El Mundo, a newspaper notoriously hostile to Gibraltar, talks about Spain’s judicial rights to go after those who use the ‘opaque fiscal paradise’ of the territory: ‘…The tax agency issued on Monday a tough note full of the vocabulary of confrontation, in which it bluntly accuses the Gibraltar Government of supporting organized crime. Hacienda claims that smuggling “is fully controlled by criminal organizations that obtain a significant funding and which are protected by the Gibraltar Government’s inaction”.
“In addition, the location of Gibraltar together with its fiscal regime and its opacity pose other similar problems of additional economic damage and that, far from being the beacon of prosperity in the area, it actually impoverishes its immediate surroundings which then extend its effects to the rest of Spain”…’. (Gibraltar has 3% unemployment, versus the more robust score in Cádiz of 43.2% in April).
As we read of Spain’s ire against the Gibraltarian banking system, little is heard of essentially a similar thing going on at the other end of the country, in Andorra. Jordi Pujol, who has been stashing much of his fortune in the small and secretive country, plans to denounce the banks there who were holding his money, for spilling the beans. ‘…The former president of the Generalitat points the finger towards Andbank and the Banca Privada de Andorra (BPA) accusing them of having violated the bank secrecy that protects millions of euros of doubtful origin from the Spanish tax agency inspectors…’. (Economía Digital).
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Corruption:
‘Corruption, which has cost Spain so far some 24 billion euros, is hurting foreign investment here. The Frankfurter Allgemeine Zeitung writes in an extensive article of the ‘sewer’ of this country’s political formations and says that the PP and PSOE are not attacking the CiU (for example, over Pujol) because “they must contend with corruption in their own ranks”…’. Found at Negocios. The original German article “Spanisches Sumpfland” is here. The first paragraph includes this damning sentence: ‘Ein Ende ist nicht in Sicht’.
The Andalucian ERE investigation, which has collected over 200 people in its net so far, includes a few aforados, those who are protected from the attentions of the common courts with parliamentary immunity. These include two erstwhile presidents of Andalucía, Manuel Chaves and José Antonio Griñán and five ex-deputies. Therefore, the judge in charge of the case, Mercedes Alaya, has sent that part of the package off to the Supreme Court in Madrid. Judge Alaya says she considers it impossible that Chaves and Griñán were not in the know.
A hostile item from FACUA, the consumers’ association, reports that the taxpayer will be obliged to pay for those failed toll motorways that surround Madrid, plus the one from Vera in Almería to Cartagena (who would have guessed?). The 2,300 million euros will be donated to the disconsolate investors (banks and building companies) next month.
An Ex-chief from the Andalucian tax office has been arrested, together with seven accomplices, after around 50 million euros of money earmarked for Government training courses went missing.
The deputy spokesman of the Partido Popular, Rafael Hernando, described as “bonkers” the comments of the President of the political group Ciudadanos Albert Rivera who accuses both the PP and the PSOE of “covering up the corruption of Jordi Pujol” over the years in exchange for their political agreements with the CiU. “These are indecent words”, said the leader of the PP … He added, “the PP never has given coverage to any kind of corruption in Catalonia, nor in any other part of Spain”. Taken from El Mundo.
The Financial Times runs an editorial on the scandal of Jordi Pujol which begins: ‘Spaniards opposed to Catalan independence, who include Mariano Rajoy, the prime minister, must be rubbing their hands in glee at the scandal unfolding in the northeast of their country. Jordi Pujol, the father of modern Catalan nationalism and founder of the Convergència Democràtica party, has admitted to tax fraud in an investigation that has already pulled in his son…’.
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Politics:
As the holidays continue, politicians are shown in jogging shorts or swimming bravely in their pools. Sometimes, perhaps on a yacht or walking around with their wife or husband. It’s the slow season. Meanwhile, that thorn in the PP side, Pedro J Ramírez (the ex-Director of El Mundo), is interviewed, here reproduced at Voz Pópuli. ‘If I was a young man starting out now and without a job, I’d be voting for Podemos’, he says. Another pearl from the journalist: ‘Britain’s Cameron wouldn’t have lasted four hours if his country had a British version of Luis Bárcenas spilling the beans on the Conservative Party’.
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Various:
‘They are either smoking an entire carton of cigarettes every twenty minutes or they are smuggling them into Spain’ said an expert on contraband noting the huge amounts of smokes imported by the territory. *My great great grandfather, Robert Napier, was the Governor of Gibraltar from 1876 to 1883. He was famously called to London after complaints from the Spanish ambassador to Queen Victoria’s government to the effect that Gibraltar was smuggling massive amounts of tobacco into Spain. Napier explained in the House that the loyal people of Gibraltar lived from this business and a stern Prime Minister Gladstone accepted his premise and ruled that ‘hereafter, Great Britain would be strongly against all forms of smuggling, anywhere in the world, except in the singular case of Gibraltar’. Meanwhile, and who would have thought it, this from Typically Spanish and quoting the Government of Gibraltar: ‘Her Majesty’s Government of Gibraltar has had brought to its attention information suggesting that Spanish television channel Antenna 3 is “staging” tobacco smuggling scenes it may seek to then portray as real…’.
When talking about foreign numbers in Spain, slightly better information means slightly more exact figures extrapolated. So ‘According to the quarterly report entitled “Foreign Citizens with a Valid Certificate of Registration or Residency Card” drafted by the Permanent Watchdog on Immigration (OPI) of the Secretariat-General of Immigration and Emigration, the total number of foreign citizens resident in Spain stood at 4,943,627 at 31st December 2013. Of the total number of foreign residents, 2,691,177 were EU citizens and their family members, meaning that 54.44% of the total are European. The remaining 2,252,450 (45.56%) fall under the general regime.
This report introduces a new methodology that consists of excluding those foreign citizens who have gained Spanish nationality and maintain a valid residency permit and excluding those foreign citizens who die in Spain and whose residency permit or certificate of registration was valid at the time of their death. This new method has led to a review of past records, recalculating the figures corresponding to data from the past according to the new methodology. This has improved the quality of the data and enabled improved analysis of future trends…’. From Kyero.
Reading further, and according to Extranjeros con certificado de registro o tarjeta de residencia en vigor, Britons are now numbered at 265,531; Germans at 143,289 and Romanians at 928,217. Can you believe that? As Per Svensson once noted, if you want to know how many foreigners there are, check the banks, or the gas company or the power company… not the information at the town hall!
‘Over 378 million people used public transport in Spain in June – a 1.8% fall compared with the same month the year before when the figure stood at 385 million users.
According to the latest figures released by the National Statistics Institute on Monday, 226.6 million people used public transport in Spanish towns and cities in June – 0.7% less than the same month in 2013…’. From El País in English.
‘National police have arrested 27 used car dealers for dialling back cars’ odometers to sell them at a higher price. The investigation began after a man bought a car in Toledo thinking it had undertaken a total of 87,000km, only to find out it had actually travelled 207,000km.
Since this incident, 48 falsified cars – from 24 dealerships – have been found in five provinces…’. From The Olive Press.
‘Britain’s ban on prisoners voting breaches their human rights, a top European court ruled on Tuesday, its latest ruling in an ongoing tussle that has riled British politicians hostile to EU human rights laws. Disagreement between Britain and the European Court of Human Rights has previously played into strong anti-European Union sentiment in Britain at a time when its ties to the 28-member bloc are being increasingly questioned…’. From the New York Times. Damn! Next thing we know, they’ll be talking about giving us Brits who have lived abroad for a long period some basic democratic rights…
A good explanation of the evident drawbacks to the ‘Google Tax’, here at Wolf Street.
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Letters
(Re: last week’s note about the British Attendence Allowance)
Pity Lorna Ainsworth did not it clear whether the Attendance Allowance, which is tax free in UK, is also tax free in Spain.
Such allowances are of course potentially taxable in Spain, like the OAP, Premium Bond winnings etc. are taxable here, if one is resident.
When I came to Spain I was in receipt of Invalidity Benefit. I had to confirm the degree of invalidity. Only if it was 100% was it tax free.
John
Hi Lenox
If you know anyone who likes a gamble I will happily give them a 3 to 1 bet that house prices will not rise in 2016 or anytime after that. I suspect the information source is the same as the one that refused to accept the property bubble.
I live near Denia (A good value property area) but recently I saw an add for a new one bedroom flat in the village of La Xara 3km from Denia. Price for this new flat 30,000 Euros. Q.E.D
Regards, John
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Finally:
A civilized way to drink wine (or, better yet, a white wine/beer/La Casera mix) is with a porrón. Here’s what happens when you introduce this splendid item, attached to a handy little camera, to the Americans…
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Nota:
Business Over Tapas
A digest of this week’s Spanish financial, political and social news aimed primarily at Foreign Property Owners:
with Lenox Napier and Andrew Brociner
For subscriptions and other information about this site, go to businessovertapas.com
email: lenox@businessovertapas.com
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