• Spain's news in English

'Only Spain claims Gibraltar is a tax haven'

AFP · 8 May 2013, 08:55

Published: 08 May 2013 08:55 GMT+02:00

Facebook Twitter Google+ reddit

"Gibraltar does not see itself as a tax haven, perhaps more importantly Gibraltar is not regarded as a tax haven by the international community," Fabian Picardo said in an interview with news agency AFP in Madrid.

Making his argument, Picardo said the territory had done more than enough to put it on the Organisation for Economic Cooperation and Development's "white list" of jurisdictions that comply with global rules.

Gibraltar earned its spot on the list at the end of 2009 and has signed 26 information agreements with other jurisdictions to comply with the standard.

To get on the "white list" a territory needs to have signed 12 or more such agreements, a criterion decided by the OECD and the Group of 20 richest nations in the wake of the financial crisis that began in 2008.

"If we look at the treatment that Gibraltar gets from the OECD, which I think is the best barometer of whether countries should be considered tax havens or not, then the OECD listings tell you very clearly that it is not a tax haven," the minister said.

"The reality is the world regards Gibraltar... as being a fully compliant financial services jurisdiction much as Frankfurt, London, Paris or Madrid might regard themselves and it is only Spain that continues beating Gibraltar with that description for its own nefarious purposes," Picardo said.

Get the latest exchange rates and transfer money on The Local's Currency page.

But Madrid continues to regard Gibraltar as an offshore centre which allows Spanish firms to pay taxes in the territory even though they operate in Spain.

Spain's tax office has set up a working group to analyze tax payments made in Gibraltar, daily Spanish newspaper El País reported last month.

It said hundreds of millions of euros in Spanish company earnings escape Spain's control each year through Gibraltar, the newspaper said.

"It is just not happening, there is no evasion, and certainly no evasion on that scale because if there were, the government of Gibraltar would detect it and it would stick out like the sorest thumb in the jungle," said Picardo.

Gibraltar, a peninsula in southern Spain ceded to the British in 1713, abolished in January 2011 its "exempt status tax regime" under which some companies avoided tax and instead introduced a single 10 percent levy.

"Ten percent is the rate which the OECD considers is the real rate of tax which a jurisdiction must have before it is considered not to be a tax haven," said Picardo.

The spat is part of a long-running dispute over Gibraltar, which houses traditional British red phone boxes, pubs and fish and chip shops.

Story continues below…

Spain argues that the 1713 Treaty of Utrecht under which Madrid ceded Gibraltar to Britain, only granted waters in the port and did not cede the three nautical mile stretch claimed by Britain.

Police boats from the two sides have faced off several times in the waters around Gibraltar, which is strategically located at the western mouth of the Mediterranean.

Picardo urged Spain to take its claim to the Hamburg-based International Tribunal for the Law of the Sea, which has the jurisdiction to settle maritime disputes.

"I am the fifth chief minister of Gibraltar to issue that challenge in the past 50 years. Spain has never had the courage of her convictions to take it up," he said.

"I think that demonstrates that they know that they don't stand a snowball's chance in hell of ever demonstrating that those are anything other than British Gibraltar territorial waters."

Facebook Twitter Google+ reddit

Your comments about this article

Today's headlines
Spain worries about tourism future
Photo: Josep Lago / AFP file picture

After basking in its best tourist summer season in 15 years, Spain now sees dark clouds on the horizon as popular destinations reach saturation point and holidaymakers are more thrifty, industry experts say.

Spain’s Socialists lift veto on conservatives
The Socialists have decided to lift their veto on the minority conservative government or not. Photo: Gerard Julien/ AFP

Spain's embattled Socialists on Sunday voted to lift a long-standing veto that has prevented the conservatives from forming a minority government, in what should finally end a ten-month political impasse.

Spain's 'Napflix' aims to bore viewers to sleep
Photo: Screengrab/ Napflix

A Spanish video platform called Napflix, designed to put people to sleep with dull content, was launched this week and its founders are on the lookout for more "monotony and repetition."

Recipe: How to make fabada - traditional Asturian bean stew
Photo: Flavio Lorenzo Sánchez/Flickr

The hearty Asturian dish is a perfect lunch on a cold day... and don't forget the crusty bread and cider!

Brit 'paedo' held on Costa del Sol after Most Wanted appeal

One of Britain's most wanted fugitives was arrested on the Costa Del Sol following a tip-off from an expat just hours after his face appeared on a public appeal.

Spain's parliament approves deficit reduction measures
Photo: Images Money/Flickr

Spanish lawmakers approved on Thursday measures to reduce the public deficit and keep it under the target agreed with the European Union.

'Cubism and War' show opens at Barcelona Picasso Museum
Pablo Picasso Harlequin and Woman with a Necklace. Photo: MP

Barcelona's Picasso Museum unveiled an exhibition on "Cubism and War" on Thursday depicting how one of the most influential artistic styles of the 20th century survived the First World War.

Why this bionic limb pioneer doesn't believe in disability
Hugh Herr has been award Spain's top science prize. Photo: FPA

The Local speaks to Hugh Herr on winning Spain's top science prize and how being an amputee doesn't make him disabled.

Dine in the buff at Spain's first nudist restaurant
A buffet of organic food will be served on "human tables". Photo: Innato / Facebook

Spain's first naked dining experience is to arrive on the island of Tenerife following the success of a similar venture in London.

Spain's top court overturns bullfighting ban in Catalonia
Photo: AFP

Spain's Constitutional Court on Thursday cancelled a bullfighting ban in Catalonia in what is likely to exacerbate tensions between Madrid and the separatist region, and between animal activists and fans of the tradition.

Sponsored Article
How to vote absentee from abroad in the US elections
Madrid parish church faces fine over 'too noisy' bells
Sponsored Article
Last chance to vote absentee in the US elections
Celebrate expat life at Madrid’s THRIVE convention
Fury after kids told to bring their own loo roll to school
Sponsored Article
How to vote absentee from abroad in the US elections
Disney announces plans for Don Quixote action movie
Activist tells 8-yr-old matador wannabe with cancer 'just die'
King to make last minute push to avoid third vote in Spain
Amazing photos of Catalonia's 'human tower' contest
What's on in Spain: October 2016
'No way, Jose! You'll never get your hands on our Rock'
Recipe: How to make a classic Spanish tortilla de patatas
Chorizo in paella? Go back to cooking school Jamie Oliver
Spain in eye of a perfect storm after 10 months without govt
Thousands share clips of life for 'Spain in a Day' film
Ten incredible Spain locations for Game of Thrones season 7
Analysis & Opinion
Why moving to Spain could be the best decision of your life
Seven reasons why autumn is the very best season in Spain
Spanish study finds four types of personality. Which are you?
New search underway for civil war grave of poet Lorca
Bison found decapitated on Valencia nature reserve
Forgotten Voices: What Brits in Spain think about Brexit
One dead and 14 injured in blast at Spanish resort
Game of Thrones want extras 'with muscles' to film in Spain
Thousands march in Madrid to push for bullfighting ban
jobs available