Spain

Spain

Reduces corporate income tax rate and approves a new special tax regime for investment in the Balearic Islands

23 Dec 2022

On 23 December 2022, Spain approved the General State Budget Law for 2023 that, among others:

1) It reduced the CIT rate from 25 to 23 per cent for entities with net revenues below 1 million EUR; 2) Introduced a new special tax regime for the Balearic Islands composed of two tax benefits for 2023-2028 taxable periods. These are: a reduction in the tax base for the profits that are destined to the provision of a reserve to make certain investments in the Balearic Islands including creation of jobs, R&D&I expenses and certain assets acquisition; and a quota bonus for taxpayers who develop industrial, agricultural, livestock and fishing activities.

Nature of measure:
  • Incentives
Type:
  • Promotion and facilitation (Investment incentives, Special economic zones)
Industry:
  • Not industry specific
  • Primary (Agriculture, forestry and fishing)
Inward FDI:
No
Outward FDI:
No
Sources: