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Spain to cut taxes for digital nomads

The Spanish government adopted Friday measures to attract so-called digital nomads -- remote tech workers who can do their job from anywhere with a good internet connection.

Published: 11 December 2021 11:37 CET

The photo shows several laptops on a tablet with notebooks, phones, a teapot and cups

The widespread adoption of remote working during the coronavirus pandemic has opened up the possibility for more workers to relocate far from home. Photo by Marvin Meyer on Unsplash

A growing number of countries are seeking to lure digital nomads with easy visa conditions and tax breaks as they can help boost the local tech start-up scene.

The Spanish measures, which will allow arriving digital nomads to use a non-resident tax status with lower rates for five years, will form part of wider legislation meant to help start-ups, including fiscal incentives for investors.

The legislation will “attract and retain international and national talents” by helping “remote workers and ‘digital nomads’ set up in Spain,” the economy ministry said in a tweet.

Spanish expatriates who have been abroad for more than five years are also eligible for the programme.

The widespread adoption of remote working during the coronavirus pandemic has opened up the possibility for more workers to relocate far from home.

Earlier this year, Croatia adopted a measure offering a one-year visa to digital nomads and exempting them from income taxes.

Georgia, Thailand, Iceland and Costa Rica also have measures in place for digital nomads.

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EXPLAINED: Spain's plan to stop the privatisation of public healthcare

In 1997, at the time when former Popular Party leader José María Aznar was Prime Minister of Spain, a law was introduced allowing public health – la sanidad pública in Spanish – to be managed privately.

According to the Health Ministry, this opened the door to a model that has caused “undesirable” consequences in the healthcare system for the past 25 years.

Critics of the privatisation of Spain’s public healthcare argue that it leads to worse quality care for patients, more avoidable deaths, diminished rights for health staff and an overall attitude of putting profits before people, negative consequences that have occurred in the UK since the increased privatisation of the NHS, a 2022 study found.

Companies such as Grupo Quirón, Hospiten, HM Hospitales, Ribera Salud and Vithas Sanidad have made millions if not billions by winning government tenders that outsourced healthcare to them.

On May 13th 2024, Spanish Health Minister Mónica García took the first steps to try and rectify this by approving a new law on public management and integrity of the National Health System, which was published for public consultation.

The document sets out the ministry’s intentions to limit “the management of public health services by private for-profit entities” and facilitate “the reversal” of the privatisations that are underway.

It also aims to improve the “transparency, auditing and accountability” in the system that already exists.

The Ministry believes that this model “has not led to an improvement in the health of the population, but rather to the obscene profits of some companies”.

For this reason, the left-wing Sumar politician wants to “shelve the 1997 law” and “put a stop to the incessant profit” private companies are making from the public health system.

The Federation of Associations in Defence of Public Health welcomed the news, although they remained sceptical about the way in which the measures would be carried out and how successful they would be.

According to its president, Marciano Sánchez-Bayle, they had already been disappointed with the health law from the previous Ministry under Carolina Darias.

President of the Health Economics Association Anna García-Altés explained: “It is complex to make certain changes to a law. The situation differs quite a bit depending on the region.” She warned, however, that the law change could get quite “messy”.

The Institute for the Development and Integration of Health (IDIS), which brings together private sector companies, had several reservations about the new plan arguing that it would cause “problems for accessibility and care for users of the National Health System who already endure obscene waiting times”.

READ MORE: Waiting lists in Spanish healthcare system hit record levels

“Limiting public-private collaboration in healthcare for ideological reasons, would only generate an increase in health problems for patients,” they concluded.

The way the current model works is that the government pays private healthcare for the referral of surgeries, tests and consultations with specialists. Of the 438 private hospitals operating in Spain, there are more who negotiate with the public system than those that do not (172 compared with 162).

On average, one out of every ten euros of public health spending goes to the private sector, according to the latest data available for 2022. This amount has grown by 17 percent since 2018.

However, the situation is different in different regions across Spain. In Catalonia for example, this figure now exceeds 22 percent, while in Madrid, it’s just 12 percent, according to the Private Health Sector Observatory 2024 published by IDIS.

Between 2021 and 2022, Madrid was the region that increased spending on private healthcare the most (0.7 percent), coinciding with the governance of right-wing leader Isabel Díaz Ayuso, followed by Andalusia (0.6 percent).

READ MORE: Mass protest demands better healthcare in Madrid

Two years ago, Andalusia signed a new agreement with a chain of private clinics that would help out the public system over the next five years.

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