SPAIN has officially removed Gibraltar from its list of tax havens, bringing an end to 35 years of diplomatic and economic friction.
Hacienda, the Spanish Finance Ministry, confirmed the move after determining that the British Overseas Territory now effectively exchanges tax information with Spain.
The delisting resolves a critical commitment from the 2021 International Tax Agreement that had remained pending for over five years.
It comes after Chief Minister Fabian Picardo recently warned that the Gibraltar government would study withdrawing from the treaty entirely if Spain did not honour the pledge.
Picardo celebrated the move as a long-overdue rectification of a historic wrong.
He said: “This is therefore a moment for celebration of a historic wrong of over 30 years being finally undone.”
He added: “The result will mean a lot to many people with cross-frontier interests, not least businesses, workers and those with second homes in Spain.”
The removal of the label is expected to provide a significant economic boost to the border region.
Juan Franco, the mayor of La Linea de la Concepcion, estimates that the change will keep approximately €30 million within the local economy.
It provides immediate relief for thousands of cross-border workers who live in Spain but work on the Rock.
Those earning under €60,000 will no longer be forced to pay the difference in Spanish income tax (IRPF), a move that had previously caused significant financial hardship.
Spain originally included Gibraltar on its list of non-cooperative jurisdictions in 1991.
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The territory has long argued the label was unjust, noting that it has been on the white list of the Organisation for Economic Co-operation and Development (OCDE) since 2009.
While removing the Rock, the Spanish government simultaneously updated its blacklist to include Russia.
Hacienda stated that the addition of Moscow was due to a damaging tax regime for international holding companies.
The ministry clarified that this move will have little economic impact on Spain due to existing trade sanctions linked to the war in Ukraine.
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