The Spanish government has formally passed legislation that has been termed the ‘start up law’, intended to attract investment and encourage internationals to live and work in the country.
Although the law applies to all sectors, it is thought that the tech industry will particularly benefit from the legislation and attract a talented international workforce that is needed to support the ambitious development of the digital sector.
The government has highlighted digitalisation as a key part of its recovery plans, with significant investment of its EU recovery funds allocated to allow companies to grow and attract start-ups to be based in Spain.
Many countries are grappling with the challenge of attracting talented international workers to support domestic workforces, and Spain has been leading the race to put measures in place that ensure its attractiveness remains strong.
The new laws allow digital nomads, as they have been called, to have a non-resident status with lower tax rates for a period of up to five years. This will also apply to Spanish expatriates who have been working abroad for over five years.
The laws also provide tax incentives for foreign investment in Spain, with tax exemptions for shares invested in new or recent start-ups.
The legislation was initially drafted to attract an influx of international workers to support its economic recovery and place Spain as a leading entrepreneurial nation with a global appeal. The approval of the new law in the Spanish Congress last week means that these plans can now be implemented.
Speaking about the new legislation, Spain’s Economy Minister, Nadia Calviño, said that it will ‘attract and retain international and national talents’ by helping ‘remote workers and digital nomads to set up in Spain’.
Since the Covid pandemic started in early 2020, it impacted on working practices across the world, with many workers forced to work remotely. As lockdowns continued, more workers realised that working remotely was not only achievable, but it was also often more desirable to being based in an office.
The scope to work internationally has paved the way for companies and sectors to attract talented workers, and Spain is cited as being one of the most popular places for international workers to be based.
With other countries, including Croatia, Thailand, Costa Rica and Iceland also introducing schemes to attract internationals to be based in their countries, Spain will be keen to promote itself on an international stage.
The new legislation will be an important part of its campaigning to entice talent and investment into the country, at a time when it is crucially needed to support Spain’s economic recovery.