The Council of Ministers of the Government of Spain has approved a bill for startups, with relevant measures for reduce red tape and remove obstacles there is for investment and financing of this type of company in Spain. In addition, the package of measures also contemplates reforms in the stock options system and access to visas, in order to make the country more attractive for entrepreneurs and to attract talent.
For this bill to become a law as such, it will still have to be approved by Parliament, after a debate in which some amendments to the law will probably be presented, which will make the text go through some changes. The set of measures, according to the Government, includes what it has called “the EU’s most beneficial treatment for returns on stock options«.
In addition, the agreement includes an increase in the tax-exempt amount for income in stock options from 12,000 to 50,000 euros per year. On the other hand, the draft of the law also establishes that the taxes are delayed until the agreement date, which can occur when the shares are sold or if the company goes public.
Among other measures included in the bill is the reduction of the corporate tax and the rate on income from non-residents, applicable to both executives and employees of startups, investors and temporary residents in Spain who work remotely, as well as for their families. It falls from 25% to 15% over four years. They will also be able to access a special residence visa in Spain for five years.
With this, the Government seeks to end some of the main barriers for this type of companies, since startups are not usually focused on obtaining income in their first years, and also, according to current regulations in force, they are expected to pay the same tax rate as more established and established companies.
The maximum deductible for investments in new or recently created companies also goes up: it goes from 60,000 to 100,000 euros per year. Also, the deduction rate goes up from 30% to 50%. The period in which a company is considered “newly created” also increases. It becomes a maximum of five years old, and seven years in the case of those dedicated to the biotechnology, energy and industry sectors, as well as other strategic sectors that have developed proprietary technology designed entirely in Spain. Of course, in all cases they must be independent companies, not listed on the stock market and not having had and shared benefits. Also have an innovative nature (lo and have an annual income of up to 5 million euros.
The new law also contemplates another of the main complaints from local startup founders: the cost and bureaucracy involved in opening a startup in Spain, which has led some founders to open their companies elsewhere in Europe. Thus, according to the proposed law, the authorities ensure that the procedures for starting a business will be refined and reduced to a single step, and can be done online without having to pay notary or registration fees. In addition, startups will also be able to use an online portal, soon to come into force, to make company statements and access various benefits and advantages.
On the other hand, the bill has other measures to encourage business creation. For example, entrepreneurs who are working as employees in another job will not have to contribute twice to Social Security. There are also plans for the implementation of secure areas or trial licenses for collaboration with authorities, universities and research centers, in order to promote the development of new services. If everything goes according to plan, the law could pass congressional approval during the first half of 2022, although the deadline to do so is until the end of that year.
