For the first time in Spain, a legal framework is established for entrepreneurs that also includes tax incentives and eliminates bureaucratic obstacles to try to attract innovators and investors, among others. The Council of Ministers approved this Friday the draft law of what is already known as the "startups law".
In our country, most of the new companies, known as startups, resulting from innovation and entrepreneurship, encounter the same problems and challenges when starting their activity. And it is not easy at all to legally set up the company, attract financing and recruit the best talent so that the business begins to grow soon and gain a foothold in the market in order to be able to make profits as quickly as possible. With this new law, the Government intends that these types of companies have it a little easier when it comes to starting up.
A battery of tax incentives
However, the main requirement established by the Administration to consider that a company is a startup, or emerging innovative company, is that it develops its own technology entirely in Spain.
In addition, they are required to have less than seven years of existence, such as biotechnology, energy, or industrial companies, or less than five years of existence for those of other sectors; It is also an essential requirement that the company is not listed on the stock market or distribute dividends; nor should it invoice less than five million euros a year and it must have a clear and marked innovative character.
From the Executive, the Minister of Economy, Nadia Calviño, has assured that these types of companies "are the basis of the new digital economy, and they are companies that generate highly qualified jobs". To promote their creation, the new regulation establishes, above all, a series of fiscal incentives, among them, the reduction of the Corporation Tax from 25% to 15%, the budgetary exemption of the first 100,000 euros of investment, which will not be obliged to pay taxes in the Treasury, or of the first 50,000 euros of the collection of shares.
The return to Spain of talent that had to emigrate to other countries in search of better job opportunities will also be facilitated, with the issuance of special visas for foreigners, returnees, and digital nomads. "Thinking especially about generating opportunities for young people, and also thinking about attracting investment," the minister concluded this Friday at the press conference after the Council of Ministers.
From the startups they value this measure positively, although they assure that it is a little insufficient in terms of tax deductions for R&D. In addition, some self-employed associations claim that the new regulations are a tax haven that will harm the majority of workers in this group. The law is part of the package of reforms that Spain has promised Brussels within the framework of the Recovery Plan by which our country will receive tens of billions of euros to alleviate the economic consequences of the coronavirus pandemic.
