The technicians of the Ministry of Finance, Gestha, trust that "the reasonable thing" is that the socimis maintain their investments in the south of Gran Canaria (in the south of the island some operate like Atom), and do not move their headquarters abroad, given the "alarm" unleashed after the announcement of the agreement of the parliamentary groups Socialist and Sumar in Madrid to end the tax regime of the real estate investment companies that operate in Spain. In this sense, Gestha has provided a series of keys to understand these proposed and not yet approved modifications. In addition to Atom Hotels, Blackstone Group, the largest hotelier in the south of Gran Canaria, Portobello Capital, Covivio - B&B Invest Espagne, CBRE Global Investors, Corum Amy or Elaia Investment Spain operate in the market.
Firstly, they consider that there may be a "corporate interest" in not making the tax advantages under which REITs do not pay taxes conditional on meeting certain investment requirements and distributing at least 80% of their profits. In this regard, Gestha points out that "the principle of legal certainty would not be violated if this aspect of its special regime in force since 2009 is finally partially modified."
Secondly, the Treasury technicians do not believe that it can be assumed a priori that foreign real estate investment in our country will be significantly reduced, "given that the changes proposed by the Executive do not affect business opportunities in hotels, premises, offices or other types of properties." On the other hand, Gestha sees that the eventual divestments in tourist housing may be positive by contributing to lowering the sale price of said properties, and could make the rental price for residential use more affordable.
Thirdly, Gestha does not share the risk of widespread exit of REITs from our country "because since 2013 an entry-exit tax regime has been in force under which the profit from the sale of a property is understood to be generated in a linear manner during the time of ownership of said property, with the part of the capital gains generated after the eventual exit being taxed according to the general corporate tax regime". Finally, Gestha does not believe that there is a loss in revenue because REITs do not pay taxes, but rather the shareholders who receive the dividends do, regardless of the country where the registered office of these entities is located.
"Even if an entity were to move its headquarters abroad, profits obtained from renting hotels, offices or homes located in Spain are subject to 24% Non-Resident Income Tax; or 25% if the company has hired at least one person with a full-time employment contract in Spain to manage the leasing of properties in our country," they emphasize. Similarly, "profits from renting properties located abroad are usually subject to corporate tax in the countries where said properties are located, allowing mechanisms to avoid double taxation in the country where the headquarters are domiciled, from which they will be taxed on all their worldwide income."
