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What it is

New economic and tax benefits for the Canary Islands

BOE step 7 of 7 · Passed

Type of initiative: . It was introduced on 7 July 1993. Introduced by: Comunidad Autónoma de Canarias - Parlamento.

Official title: Private member's bill on the Modification of the Economic and Tax Regime of the Canary Islands.

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Source: Congreso de los Diputados, file 125/000008· updated 11 Nov

Automatic summary, not yet reviewed

  1. The law updates the Canary Islands' Economic and Fiscal Regime to compensate the islands for their remoteness and insularity as an outermost region of the European Union, and promotes their economic and social development.
  2. Commercial freedom is reaffirmed: goods can be imported and exported without quantitative restrictions, and no monopolies on goods and services apply in the Canary Islands, except for essential services reserved by law.
  3. Air and sea transport are governed by the principle of freedom, with no monopolies, and residents of the Canary Islands get discounts on regular transport tickets: 33 % on routes to mainland Spain and 10 % on routes between islands.
  4. Compensation systems are created to lower the cost of shipping goods between the islands and to mainland Spain, and to keep prices of energy and desalinated or reused water moderate.
  5. State investment in Canary Islands infrastructure will be at least 50 % of the revenue attributed to the State as compensation for abolishing the General Tax on Business Traffic.
  6. Tax incentives are approved for companies: exemptions when they are set up or invest, a 50 % corporate tax credit for exports to third countries or the European Union, and an investment reserve that reduces the taxable base.
  7. The Special Canary Zone (ZEC) is created, an area where authorized companies can operate with tax benefits, such as paying Corporate income tax The personal income tax (IRPF in Spain): what people pay on what they earn from work, business or savings. at a 1 % rate, as long as they meet strict requirements on activity and containment.
  8. Ships registered in the Special Register of Ships and Shipping Companies enjoy tax exemptions and credits, and their crews get credits on personal income tax and Social Security contributions.

Who it affects

  • Residents of the Canary Islands: Discounts on regular transport tickets to mainland Spain and between islands, plus moderate prices for energy, water and telecommunications.
  • Canary Islands companies: Tax exemptions and credits if they invest, are newly created or export from the archipelago.
  • Foreign investors: Can set up in the Special Canary Zone (ZEC) with a 1 % corporate tax rate, if they meet the requirements.
  • Shipping companies and crews: Tax benefits and Social Security rebates for ships in the Special Register.
  • Public administrations: Must coordinate through a Joint Commission and fund the planned compensations and investments.

Words worth knowing

Régimen Económico Fiscal de Canarias
The set of economic and tax rules specific to the Canary Islands due to their condition as a remote island archipelago.
Estanqueidad
Principle requiring the Special Canary Zone to stay sealed off from the rest of the territory: only authorized companies with limited activities can join it.
Base imponible
Taxable base: the amount on which a tax is calculated, that is, the income or profits taxed.
Zonas Francas
Free trade zones: delimited areas where goods enter and leave without customs duties or usual customs controls.
Cabotaje
Cabotage: sea or air transport between points in the same country, such as between the islands or between mainland Spain and the Canaries.
income tax
The personal income tax (IRPF in Spain): what people pay on what they earn from work, business or savings.

It summarizes the law as published in the BOE. It is written by artificial intelligence and may contain mistakes: the official text is what counts. Read the official text · How we make summaries

Where it stands

How far did it get?

It took 7 of 7 steps. It reached BOE, and today it is passed.

  1. Introduced7 July 1993Someone registers the text in the Congreso.
  2. Admitted13 July 1993The Bureau of the Congreso accepts it and, for a members’ bill, the plenary decides whether to consider it.
  3. Amendmentsno dateGroups propose changes.
  4. Committeeno dateA committee goes through the text in detail.
  5. Plenaryno dateAll 350 deputies vote.
  6. Senateno dateThe Senate can pass it, amend it or veto it.
  7. BOEno dateIt is published in the Official State Gazette (BOE) and comes into force.
See the 2 official steps on a timeline
Jul 199311. 7 July 1993: Presentación22. 13 July 1993: Calificación

Was there a plenary vote?

We have no plenary vote linked to this law in the Congreso’s data.

What happens next

What happens now?

It is law, or will be once published in the BOE. It comes into force on the date its own text sets.

The same initiative in the other chamber:

Published in the BOE: Law 19/1994, of July 6, amending the Economic and Tax Regime of the Canary Islands.

Sources

Where does all this come from?

  • The data comes from the open files of the Congreso, the Senate and the BOE, unaltered.
  • Each deputy’s province is the one of their seat on the day of the vote.
  • We only say “passed” or “rejected” when the majority needed is certain; otherwise we say which side had more votes.

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