Spain has just brought in tax on large fortunes…
Wealthy Spaniards are described as “migrating” over the border to Portugal – not just because the Constitutional Court in their own country has approved a new tax on large fortunes.
The Portuguese Socialist Party’s backtracking over NHR (the non-habitual residents’ regime, that it initially said would be dismantled at the end of the year) is making Portugal “very much more attractive” now.
Spain has a similar regime (known colloquially as the Beckham Law, after David Beckham), but it sees cannot apply to wealthy nationals. Add to this the general distrust over the new political regime in Spain, led by Socialist Pedro Sánchez, cobbled together with parties of the left and right.
Say local reports: “the re-election of Pedro Sánchez as Spain’s president has provoked an increase in the number of searches on changing fiscal residence, by Spaniards but also Hispanics who have previously transferred their residences to Spain for political and/ or reasons of security. The preferred destinations? Italy, Switzerland and… Portugal”.
These people are now “looking for alternatives to the political situation and tax burden in Spain (…) Portugal’s decision to extend its tax regime for non-habitual residents is labelled a “brilliant move”, says Spain’s El Economista.
And then there is the tweak to the Regressar Programme – previously targeting former citizens to ‘come back to Portugal’ with the lure of tax breaks. As of next year, and thanks to the State Budget due to be approved any day now, the programme has been extended to take in people who have never lived in Portugal, and are not even Portuguese…
Spanish tax lawyers have seen the beauty in Portugal’s to-ing and fro-ing, explaining that the idea in tweaking the Regressar Programme was to fill the “void” left by NHR. But now that both are going to be in full swing at the same time, opportunity knocks for those with lots of zeros that they would prefer to be keeping on their bank balances…ND