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
email: businessovertapas@gmail.com
Note: Underlined words or phrases are
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15 October
2015 Nº 133
Editorial:
The one family
that has unwillingly found fame through the politics of the threat of
demolishing homes across Andalucía, and indeed the first family to have their
home knocked down, back in January 2008, is the Priors. Practically household
names among the foreign residents, Helen and Len Prior have that peculiar
British characteristic of not turning away from trouble. They have been an
embarrassment to the politicians of San Telmo in Seville for almost eight years
as they continue to live, as best they can, in the garage next to their ruined
house. But now, look. As the couple were attending a fund-raising meeting held
by the splendid AUAN in a nearby town, the Prior’s residence was ransacked
last week by burglars.
…...
Housing:
From
The Independent: ‘Britons buying a
fifth of all Spanish property sold to foreigners.
New figures
indicate moribund prices and a strong pound are making holiday homes in the sun
more appealing’...
An
article in El País enthuses
about houses built from wood. They are cheaper and quicker to build and are
more energy efficient. Unfortunately, the traditional brick, bloque and cement home is the norm in
Spain and Town Hall planners can be remarkably resistant to innovation.
Your residence
status, explained
by The Eastbourne Herald: ‘While the
thought of going abroad to work or retire may be exciting, the months leading
up to departure are likely to be highly stressful. It is vital that you pay
adequate attention to financial planning. In particular, the tax consequences
of leaving the UK are quite complex, so it’s essential that you seek
professional advice...’.
‘A change in the
law allows extra protection for illegal urbanisations’, says
El Diario disapprovingly. Buyers in
good faith will need to be fully compensated before any demolition can go ahead
– a situation, according to Ecologistas en Acción, which makes the destruction
of an illegal urbanisation almost impossible. The only point where the
ecologists and the indignant residents concur: sentences arrive late and
achieve little.
…...
Tourism:
Tourism is undoubtedly the Spanish miracle, with massive numbers of
foreign visitors (perhaps 68 million for 2015) bringing with them untold
amounts of money to be spent here. But, argues an
article at Sabemos Digital, is this good old Spanish knowhow, or
more a series of happy coincidences? Let’s see: Some of Spain’s rivals are in
civil war or simply dangerous. The cost of petrol has collapsed. The Euro is
down against other currencies. A large part of the tour operators’ money stays
in their home country. Many visitors to Spain are counted – perhaps
inaccurately – as ‘turistas’ (those
changing flights in Madrid, or cruise-ship passengers...). The recent invasion
of algae in Caribbean waters (here).
Spain is an attractive destination for many reasons: but a political, medical
or geological emergency could change this situation overnight.
…...
Finance:
‘Spain's
government on Tuesday vowed the country would meet its targets for lowering the
deficit of its recovering public finances, in the face of scepticism from EU
authorities. As it prepares to fight for re-election in December, it denied
claims that its budget forecasts were too optimistic...’. From
The Local.
Volkswagen (SEAT)
and Spain: an
article from Wolf Street about
the troubled car manufacturer ends with this: ‘... “It seems that the
government’s electoral campaign is more important than the interests of the
country’s workers and citizens,” said Matías Carnero, the president of Seat’s
business committee, adding that the Minister’s intervention had “pissed everyone
off.”...’.
An opinion
piece in 20 Minutos respectfully
reminds both the Government and the Spanish banking industry that the 61,495
million euro bail-out of the banks with Public money needs to be paid back. To
date, only 4.3% has been returned, suggesting that little or nothing more can
be expected. Why, then, did we bother to rescue them?
The AVE network
will still be losing money fifty years from now, says
El Confidencial gloomily, with some
lines – haemorrhaging money endlessly. The contrast: The high-speed line Tokio
– Osaka has 130 million passengers a year, Paris – Lyon 25 million and Spain’s
Seville – Madrid just five million. All three lines cover similar distances.
Facing the ploy of
Big Business juggling profit and loss and craftily declaring lower taxes in
Ireland, says
El País in English, ‘...this week, the
Organisation for Economic Cooperation and Development (OECD) presented an
ambitious 15-point plan to curb these tax-avoidance practices. The Base Erosion
and Profit Shifting Project hopes to make global firms pay taxes where their
activities are really taking place...’. Spain has seven particularly deft tech
groups who shift their profit line to other countries, according to the report:
Amazon, Twitter, Microsoft, eBay, Google, Facebook and Apple. Meanwhile, the
Irish, says
El Economista, are actually
currently reducing corporate tax to
6.25% (compare Spain at 28%) to help attract further shenanigans of a similar
nature.
94,000 Spaniards
ceased being ‘millionaires’ in 2015 (leaving a comfortable 360,000 of them),
but there are still plenty of ‘super-millionaires’ here. El Mundo makes the
case.
‘It is becoming
harder than ever for expats to avoid paying the tax they owe thanks to
international efforts to stop tax evasion. A year ago the Organisation for
Economic Cooperation and Development (OECD) co-ordinated an agreement to
automatically swap tax information, with finance ministers from 51 countries
signing up to the deal. Chancellor George Osborne said at the time that tax
evasion was “not just illegal, it is immoral” and that because a tax evader was
robbing their fellow citizens, they should be treated like “a common thief”...’.
From
The Telegraph. The five countries
taking the lead (according to the article): Spain, Germany, Brazil, Argentina
and Russia. A Reader says: ‘As Spain tops
this list - and as their tax authorities contain (not surprisingly) the least well-educated
(and monoglot) tax authorities of any nation (of the eleven I have experienced),
one would be well advised to pay attention to the possible dangers.
Their behaviour is not good with laws invented to suit
themselves (totally unjustified and retrospective re-calculation of property
sale taxes being one of their favourites) and applying others, also
retrospectively, against foreigners.
These are two amongst their lowest and least ethical points (and are oft
reported on in the press).
Foreigners are not well set to resist - hence they are
a target - whereas Spaniards (and their press) will tell you that over 60% of
their efforts are aimed at foreigners and barely
40% of their work is undertaken against the nation's
biggest crooks (and they are BIG!).
Although my Asesoria has won
my battles (and had their false claims put aside for me) it is, nonetheless,
for these reasons and above all others, that we shall leave Spain as soon as
our property is sold.
Own a house in Spain by all means - but do not twin it
with tax residency (or vice versa)!!!
Better still - just rent’.
…...
Politics:
‘Spain’s economy
is back on track. In fact, it has never been better. That’s the narrative being
peddled by the Rajoy government and all those who desperately need it to win
December’s do-or-die general elections, including Spain’s big banks, corporate
giants, and the Troika of international creditors. And they will do “whatever
it takes” to keep the narrative intact...’. With Wolf Street, there’s always
a ‘but’ (six of them in this
article).
Full and
interesting précis from
Typically Spanish of a revealing
interview by the Treasury Minister Cristóbal Montoro to El Mundo: ‘Some of my
companions are shameful for what we have done, for being PP’. In a two and a
half hour interview, Montoro had all the time he needed to in his words for
‘deep reflection and sincerity’. ‘I am a strange right-wing minister because
the IBEX index doesn’t like me’, he says...
El Diario reports
that Mariano Rajoy has spent heavily on Defence, going 40% over-budget in this
field – that’s 8,720 million euros extra in this legislature. Who is becoming
wealthy off these succulent contracts, asks Público, introducing a book called ‘El lobby de la industrial militar española. Adónde van nuestros impuestos’ (Icaria) by Pere Ortega.
Arantza Quiroga, the
leader of the Partido Popular in the Basque Country, has
resigned. The reason: Madrid would not let her deliver a key speech asking
for ‘an end to violence’ without making specific mention of the ETA terror
group.
‘The mayors of
Madrid, Barcelona and Valencia, where leftist parties and coalitions took over
the city governments after the May 24 municipal elections, are the most popular
politicians in their respective cities. That’s according to a new post-election
survey conducted by the CIS state-run polling organization, and released on
Wednesday...’. Found
at El País in English.
Pedro Sánchez, the
PSOE leader, says that the PP has ‘used the crisis to build on inequality’, and
his government would initiate major political changes in various key areas
including abolishing the Gag Law (‘Ley
Mordaza’) lowering the high IVA on
culture, improve education and other social guarantees. Nueva Tribuna has more here.
The Sun Tax: ‘Spain’s energy ministry has approved a new
regulation for self-consumption, which has been branded as a deliberate attempt
to avoid the development of PV and self-consumption within Spain, by the
country’s solar association ... Spain’s energy ministry described the law as “a
framework for the orderly development of consumption, ensuring the safety of
the electrical system is established at all times”...’. Story
at PVTech. Tricky stuff? El Diario says
that the BOE (State bulletin) published an ‘unintelligible text of 44 pages to
the confusion of citizens and journalists alike’.
The Partido Popular promotional video
– from the emergency room to complete recovery (in four years).
......
General Elections 20D
El País has published the latest
poll, by Metroscopia, giving the
lead by a hair to the PSOE. Results: PSOE at 23.5% followed by PP at 23.4%.
Next comes Ciudadanos at 21.5% and trailing behind, Podemos at 14.1%. Another
poll, perhaps less credible, comes from Podemos itself here:
In this poll, we have the Partido Popular a clear leader at 20%, Podemos and
PSOE at 15% each and Ciudadanos at 14%.
The Partido
Popular is aware that it will not catch the same support as four years ago in
the Christmas elections, and it will probably need to find a partner, such as
Ciudadanos. There’s a red line though, says
El País in English: ‘...“Ciudadanos
can ask for and demand to negotiate whatever it likes, and we are open to talk
about anything, ... but we are not going to allow them to be the ones who
decide or determine who is our candidate.”...’ - that’s to say: Mariano Rajoy.
The Ciudadanos leader, Albert Rivera, says
he doesn’t think a pact is possible: ‘We didn’t put this all together just so
that Rajoy can become president again’.
Salvados is a popular TV show on La Sexta, interviews of public figures by the oddly
uncharismatic Jordi Évole. He finds good interviewees though, with Julio
Iglesias last Sunday, and this coming Sunday, a
special with Ciudadanos and Podemos leaders Albert Rivera and Pablo
Iglesias. A short promotional video shows the two
politicians having a companionable coffee together and enthusing about the
Julio Iglesias song ‘Soy un truhán, soy
un señor’ : (I’m a Rascal, I’m a Gent).
It remains
tough for Spaniards living abroad to vote – as the Partido Popular
continues to block any relaxation of the stringent rules. Indeed, only around
5% of the ex-pat Spaniards will likely vote – and perhaps even less, as those
registered to vote abroad won’t be able to vote at home... a situation which
would arise in some cases during the 20D Christmas holidays. Is this a form of
gerrymandering by the PP, as Spaniards abroad might be thought hostile to the
Government’s record on employment?
…...
Corruption:
While the Judge
Ayala has been removed from the ERE inquiry in Andalucía (see Courts below), another absence, this
time a key financier called Eduardo Pascual, under investigation for his
part in the fraud, has been noted by the National Audience. Breaking bail for
600,000€ but still with his passport – where has he gone, they wonder...?
…...
Catalonia:
The stumbling block to Artur Mas’ Junts Pel Sí and his vision of
an Independent Catalonia is the other Independence party, the CUP, with
its ten deputies. Oh, the anti-capitalist CUP wants independence all right,
unilateral and now, they also want to disobey all and any laws from Madrid and
furthermore to nationalise everything that isn’t nailed down in Catalonia.
These conditions for a deal may not entirely convince the conservative side of
the larger party... Story
at Libre Mercado.
The Partido Popular is incensed (sic!)
that the mayoress of Barcelona Ada Colau won’t turn on the Christmas
illuminations for the city until December 1st. They call it ‘Festive Season
Censorship’, since, as anyone knows, the Christmas lights should be up and
burning by the 21st of November. The story at El Huff Post here.
…...
Courts
The Superior Court
of Andalucía has ruled that Judge Mercedes Alaya will no
longer be connected to the agonizing inquiry into the ERE. Meanwhile, the
Catalonia Supreme Court, tasked by Madrid with finding Artur Mas guilty of
sedition for the false referendum on independence last year, is complaining
that it can’t do its job, what with all of the protestors gathering outside its
gates... Both stories from El Mundo.
…...
Brexit:
‘...Over the last
three decades, hundreds of thousands of Britons have used the EU's right to
free movement to settle in Spain, drawn by warmer weather, cheaper property and
a new life. But the implications of a referendum on EU membership that Prime
Minister David Cameron has promised by 2017 are troubling some of the 800,000
Britons who have made Spain their home...’. From
Reuters.
The Reino Unido: Who wants to stay in the
EU, who wants to go? Article in El País
here.
…...
Various:
From
The Guardian: ‘Pedro J Ramirez is Europe’s top stool-stirrer. Long ago,
he was editor of Diario 16 in Madrid until he fell out with its owner and went
off to found El Mundo, whose list of scoops would make any journalist’s eyes
water. El Mundo’s owner opted for a quieter life a couple of years ago, but
Pedro is back, with El Español, a website that Spain may need to watch...’.
The new website is now open. See it here.
‘According to a recent report ... four out of every ten job offers
published in Spain for work abroad, are for jobs in Germany, the Netherlands
and the United Kingdom. The report highlights that the number of job vacancies
published in Spain for work overseas rose by 5.2% in 2014. Despite this,
however, the proportion of foreign job offers over the total stood at just 0.9%
since offers for work within Spain increased by almost the same percentage
(4.9%)...’. Found
at Kyero.
‘Spanish people
are officially the healthiest in the world and women live longer than anywhere
else in Europe, according to the WHO. But the World Health Organisation has
warned that Spanish adults are also among the fattest, with 23.7% of adults
aged 18-plus being considered clinically obese last year – higher than in 2010
when they accounted for 22.1% of the country's population...’. From
Eye in Spain.
From today
(Thursday), foreigners wishing to take out Spanish nationality will
need to pay 300€ as part of the process, which includes language and a
general knowledge test on Spain. They will need to have been ‘residente’ for at least ten years.
‘...Western Sahara
is a divided territory with a complex, war-torn history. Spain ended more than
90 years of colonial rule of Western Sahara in 1975 after decades of a violent
Sahrawi independence movement. When the Spanish left, Morocco sent 350,000
settlers and 20,000 troops into the territory, kicking off a war that lasted
for 16 years...’. Story about ‘the longest minefield on the planet’ at DW here.
Following from
last week’s story of ex-politician Trinidad Jiménez getting a job on the board
at Telefonica, here’s another, the ex-president of Navarra, Yolanda Barcina, to
sit by her side.
One out of every
four aquifers in Spain – which provide around 70% of water for towns under
20,000 inhabitants – is contaminated
with nitrates from the heavy use of fertilisers in agriculture, which can be
dangerous for the health of the local residents, says
El Ventano, quoting the Instituto
Geológico y Minero de España.
The huntin’ and
shootin’ magazine Jara y Sedal has
another scoop
this week: they’ve found a cure for dogs sick with leishmaniosis, with a 95%
cure-rate in tests!
…...
Urban abuse:
7th of October:
the first reading of the Parliamentary Bill, to deal with illegal land
divisions (parcelaciones urbanísticas)
containing irregular houses, took place in the Parliament of Andalucia.
As Gerardo Vázquez,
spokesperson for AUAN, and other associations, and who was present during the
parliamentary session explained ‘Those affected support this change and in
general are pleased with it. Obviously, it does not cure everything and we must
continue to work. Whilst it is estimated that there are 300,000 illegal houses
in Andalucía, the means to regularise 25,000 of these houses, would bring
relief to 25,000 families, many of whom acquired their property in good faith
and invested their life savings in Spain.
Therefore AUAN, SOHA and other associations belonging to the CALU
confederation welcome this change’.
After the
parliamentary session, the associations briefly met with José Fiscal, Minister
for the Environment, as well as members of the PSOE and members of the
Ciudadanos parliamentary group such as Irene Rivera, spokesperson for this
group, and others.
Maura Hillen,
president of AUAN, who was also present in the parliamentary session, said ‘It
was an exciting day. None of the political groups objected to the bill in its totality
by submitting objections at this stage and we thank them for that. We
understand that the bill will now pass to the Environmental and Planning
Commission and we hope that the final text will be approved as soon as
possible. It would, for example, be a good Christmas present for many people’.
(Press note)
…...
Finally:
…...
