Is Gran Canaria a tax free zone?

Companies located in the Free Trade Zone of Gran Canaria enjoy a series of specific customs and tax advantages as a result of the legislation relating to free zones in the European Union and the REF in the Canary Islands. Exemption from the payment of duty upon entry of goods in the area.



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As an example, the Canaries are not part of the European VAT but instead they have a local consumer tax with a standard rate of 7% (much lower than the minimum 15% rate set by EU to each of their member states), besides this, without a doubt, the principal attraction for investors is that the region has by far the ...

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In the Canary Islands, a specific tax is applied instead of VAT, called the Canary Island General Indirect Tax (IGIC). The ordinary IGIC rate is 7%, and the other IGIC rates are 0%, 3%, 9.5%, and 15% (20% for tobacco).

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Remember you are not allowed to sell anything that you have bought duty free. The Canary Islands are a particular tax-free zone that is not affected by the removal of duty-free shopping within EU countries.

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The canaries are an EU tax haven, although not in the traditional sense: this jurisdiction, part of Spain, makes available many tools for tax planning of known companies. First, the Canaries tax system is easier and with lesser tax burden than other European countries, fully legal and authorized by European Commission.

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The Canary Islands are not part of Community territory for the purposes of VAT (Article 6 of VAT Directive ).

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The Spanish Government operates 4 Free Zones: i) Ceuta and Melilla free zones ii) Cadiz Free Zone iii) Vigo Free Zone and iv) Canary Islands Free Zone. These zones offer multiple benefits including i) reduced corporate tax rate of 4% ii) reduced VAT rate of 7% iii) transfer tax exemption and iv) stamp duty exemption.

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Currently the Canary Islands doesn't have a tourist tax, but there are ongoing in-depth talks about whether one should be introduced, how much it would be, and how to implement it.

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The traveller may request the refund of the VAT paid on their purchases in Spain, provided that they meet all the legal requirements and that the electronic reimbursement document (DER), which proves their purchase, is correctly approved by the outgoing customs office.

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The tourist tax, also known as ecotax, is applied in several regions of Spain. However, two prominent tourist destinations where this tax is levied are Catalonia and the Balearic Islands. In Catalonia, the implementation of the tourist tax became effective from 2012.

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Allowances for other goods: You are entitled to bring back other goods worth up to euro 430. Included are perfume and souvenirs. However, if you buy a single item worth more than this then you will pay duty on its full value.

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The Community of Madrid is known for having one of the lowest tax burdens for low incomes in Spain. The regional Personal Income Tax (IRPF) rates are relatively lower, resulting in lower tax payments for individuals with lower incomes.

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11 Countries with The Lowest Taxes in Europe: 2023 Tax Guide
  • Andorra. This medieval village nestled into the mountainside shows the beauty of the Andorran countryside. ...
  • Hungary. Beating Bulgaria, Hungary has a corporate income tax rate of 9% tax rate with no minimum. ...
  • Bulgaria. ...
  • Czech Republic. ...
  • Georgia. ...
  • Gibraltar. ...
  • Malta. ...
  • Monaco.


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Monaco. Monaco has long been considered a top country for wealthy individuals to live in. The microstate has favorable tax policies for everyone, from non-residents and residents to corporations. Not only is zero tax levied on income earned outside Monaco, but income earned in the country is also tax-free.

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