Antonio Flores’ Blog

A renewed attempt by the Spanish Government to lay claim on the rock has meant that a few thousand Gibraltar tax-domiciled that effectively reside in Spain will now be investigated, according to an official press release.

As it generally happens with the Spanish `Hacienda´, a well-phrased announcement is enough to cause disturbance among the Costa del Sol expat floating community some of whom take advantage -in the words of the Spanish Foreign Minister- of the proximity of Gibraltar to set up there for tax purposes and yet live across the border “enjoying social, community and health services in our country without paying a single euro toward the Treasury,” as stated in the release.

Aside from the blatant message that this announcement encapsulates –Gibraltar should be Spanish-, there is some reason for concern as Spain could immediately tighten up conventional border control processes or implement e-passport gates as in the UK, a measure that would provide an enormous flow of information that could be collated to target Gibraltar not-so-residents who spend more than 183 days per tax year in Spain.

What could Spain do?

Spanish tax laws consider that fiscal residency is made up of 2 elements, one being an objective criteria based on permanency (more than 183 days in Spain) and a second rather more `spiritual´: the desire to reside in a particular place. These 2 elements define the concept of residency for tax purposes and numerous Supreme Court rulings back this definition.

If the Spanish Tax Office deems that a particular person is a fiscal resident, it will send him/her letter demanding full disclosure and payment of taxes in Spain on worldwide income and/or initiate an investigation.

How can they find out?

Conventional border controls would certainly be the main way to find out. But also, presumptions can be invoked to deem someone a tax resident: registration with Town Halls (`empadronamiento’), levels of consumption of water and electricity on a given Spanish property, children’s enrolment in Spanish schools, main business activities (directly or indirectly through straw men) or use of medical facilities in this country and generally, any means of legally proving that a person effectively resides in Spain.

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Every Town Hall in Spain counts, within its municipal ordinances, with very specific rules on what is the maximum noise any person should have to put up with. These rules are pretty much standardized around the country and establish that they will be applicable, within the municipality, to any activity, installation or behaviour that generate noises or vibrations susceptible of producing a nuisance or damage to people or goods situated within its scope of influence.  

The decibel (db), which is the universal unit of sound measurement and is measured with a meter that registers sound pressure and displays these readings on a sound level scale, is crucial to establish whether any of the following produce illegal noises: your neighbour upstairs, his dog, someone’s car or motorbike in the vicinity, a pub, a basketball court and generally, any such activity that produces noises.

Spanish Town Halls pretty much follow the recommendations of the World Health Organization (WHO), which establish a maximum of 55 decibels during the day and 45 at night. Any activity that breaches these limitations will be causing a statutory noise nuisance, and it is then when the Town Halls have to act to stop it.

Who can be held responsible for illegal noises?

In the first instance, whoever causes it if the noise is illegal. Last May, 2 pub owners were sentenced to 4 years in prison by the Spanish Supreme Court for committing an acoustic environmental criminal offence. They had systematically disobeyed the Seville Town Hall’s orders to limit the noise to the point of ignoring the suspension of the activity. A psychologist expert witness diagnosis was categorical: the emotional and mental disorders that years of destructive noise levels where so severe that they could take years to cure.

If a Town Hall does not act, they then become responsible for not implementing its own laws; “El Copo” case is probably the most famous given that the Andalusian Supreme Court ordered the Velez Malaga Town Hall, recently, to compensate 18 neighbours with just over 5 million Euros for not taking action against Torre Del Mar pub owners whose businesses caused noises reported to be, in peak season, in excess of 120 decibels when the maximum legal was 30!

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