Limitation of the cash payment to 2,500 euros

The limitation of the cash payment to 2,500 euros from companies and professionals is effective from today, according to the new anti fraud law.

Failure to comply with this limitation, which rises to 15,000 euros when the payer is an individual not residing to avoid prejudicing the money spent by tourists visiting Spain, carries an administrative penalty for both the payer and the recipient, with a penalty of 25% of the total payments made.

In addition, the Tax Office has clarified that if an operation exceeds cash paid 2,500 euros but you pay in several times splitting the payment of amounts below the legal limit, is also breaking the limitation is effective now. That is, if an operation of 4,000 euros is payable in cash in two installments of $ 2,000 each, the penalty would be 25% above 4,000 euros and thus € 1,000 in total.

General Strike call on November 14th

Spain’s main labor unions, CCOO and UGT, plan to call a general strike for November 14 to protest the government’s austerity drive, just eight months after the last country-wide stoppage.


The stoppage will be formally called at a top level meeting on Friday. This will be the first time two general strikes have been held in the same year. A meeting will also be held of the so-called Social Summit, which groups together some 200 social organizations opposed to the government’s economic policies.

The decision to go ahead with the stoppage came just hours after the European Trade Union Confederation called for strikes and demonstrations against the belt-tightening movement in Europe on November 14.
The Portuguese union CGTP has called for a national strike on November 14, while stoppages are also expected in Cyprus and Greece.

CCOO and UGT sources said the proposal to hold a pan-European mobilization came from the Spanish labor unions which have been in talks on the issue with their Portuguese counterparts since a few months back.

The strike will coincide with campaigning for regional elections in Catalonia on November 25. CCOO and UGT have never previously called for a general strike during election periods.

Source: ElPais

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Tax inspectors believe collections will fall in the next few years

"How can my client square up two Picassos that he has abroad?" a tax expert asks, quite openly. This scene occurred last week in a meeting organized by the Spanish Association of Tax Advisors (AEDAF) with officials from the Tax Agency (AETA) to clear up doubts about an amnesty for tax dodgers introduced by the government.

The amnesty offers the holders of black-market money or assets to declare them without prosecution, paying only 10 percent of their value. The government is hoping to take in 2.5 billion euros from the measure, which is in place only until the end of November.

Tax advisors are asking AETA for more time because of what they claim are uncertainties in a process they describe as confusing. Some are having problems dismantling the complex business arrangements they designed to squirrel black-market money away from the prying eyes of the AETA to tax havens overseas. Others have doubts about what part of their clients' income comes under the umbrella of the statute of limitations and what might still be liable for tax.

Spain’s employment rate has topped the 25-percent mark

Spain’s employment rate has topped the 25-percent mark for the first time on record, while Prime Minister Mariano Rajoy continues to mull the merits of a second bailout.

According to the National Statistics Institute’s (INE) Active Population Survey (EPA), the number of people out of work on the third quarter jumped by 85,000 to 5.778 million. The economy - in recession for the second time in three years - shed 799,700 jobs over the past 12 months.

The jobless rate rose by 0.38 percentage points to 25.02 percent. That was the first time the rate has stood above 25 percent since the current series of figures was first compiled in 1976. With the economy contracting for the fifth quarter in a row in the period July-September, and expected to shrink 1.5 percent for the year, unemployment is set to continue rising.

Spanish economy shrinks by 0.3 percent in the third quarter

The Spanish economy contracted for the fifth quarter in a row in the period July-September but by slightly less than expected as this summer’s value-added tax hike continued to push inflation higher in October.

According to a flash estimate released Tuesday by the National Statistics Institute (INE), GDP in the third quarter shrank by 0.3 percent from the previous three months. Both the Bank of Spain and the Economy Ministry had predicted a contraction of 0.4 percent, equal to the magnitude of the decline in output in the second quarter.

Labor Minister Fátima Báñez said Monday that the Spanish economy was “emerging from the crisis,” although she produced no data to confirm this impression. The government is still debating whether to seek a bailout from the European Stability Mechanism. This would trigger purchases of sovereign debt by the European Central Bank with a view to lowering the country’s borrowing costs. Prime Minister Mariano Rajoy said Monday he believes a bailout is not “essential” at the moment.

On an annual basis, the fall in activity accelerated to 1.6 percent from 1.3 percent. In the period January-September, GDP shrank 1.2 percent, in line with the government’s prediction of a contraction of 1.5 percent for the full year.

UK Citizens. Access to healthcare: S1

If you are in receipt of a UK State Pension or a long term incapacity benefit and you decide to move to Spain permanently, ask for your S1 (previously E121) from the International Pension Centre (IPC) in Newcastle.

Once registered with the Spanish authorities, the S1 gives you and your dependants the same medical cover in Spain as a Spanish national under the Spanish state-run health scheme. This cover may not be the same as you received on the NHS in the UK so you may have to pay for some treatments or services. Remember that:

• treatment given privately and repatriation costs to the UK are not covered. Think about whether you want to take out private health insurance.
• some social services may not be available.

For further details don't hesitate to contact to us.

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Rajoy still undecided on bailout

Prime Minister Mariano Rajoy said Friday he had yet to make his mind up on whether to ask for a second bailout to ease Spain’s borrowing costs, and denied he came under pressure to decide at the European Union summit meeting on Thursday in Brussels.

“I have to take this decision as head of the government and it hasn´t been taken,” Rajoy told reporters. “If I have to take it, I will take it.”

Rajoy said it was important that the bailout mechanisms exists. The most likely option for Spain would be to seek a precautionary credit line from the European Stability Mechanism (ESM), which in turn would trigger the purchase of Spanish sovereign debt in the secondary market by the European Central Bank (ECB).

The summit in Brussels postponed creating a pan-European banking union under the sole supervision of ECB that would allow the direct recapitalization of the bloc’s banks until 2014. Both Rajoy and French President François Hollande had called for the union to be in place earlier but German Chancellor Angela Merkel was opposed to this.