Spanish Campaign Against Offshore Jurisdictions Sparks Fear In Gibraltar

by Robert Lee, Tax-News.com, London

06 February 2004

According to various media reports from the jurisdiction, the Gibraltar opposition parties have highlighted a recent statement by the Spanish tax department that Spain intends to clamp down on tax abuses in “offshore places like Gibraltar”.

"Gibraltar has been specifically identified and singled out by name as the area being targeted by Madrid this year and it is important that we should be on our guard,” warned a GLSP/Lib opposition spokesman.

In particular, the Opposition is concerned about the effect of new legislation which allows the Spanish authorities to request information from the Gibraltar government though the United Kingdom Foreign Office post-box. It is thought that this may raise issues of VAT and excise duties for businesses involved in import and export activities.

“It is well known that Gibraltar does not apply VAT and that VAT evasion is therefore not a crime here. However, the new laws that the Government put in place at the last meeting of the House of Assembly mean that the Spanish authorities are now in a position to require the Gibraltar authorities to provide information,” the spokesman explained, adding:

“Information could therefore be given in response to Spanish requests relating to movement of goods to and from Gibraltar in respect of which it could be argued that issues affecting VAT and Excise Duties are relevant.”

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