To many people, the Canary Islands inspire images of sunshine, holidays and beaches.
This is no surprise as the archipelago attracts more than 15 million tourists every year.
However, apart from the islands natural advantages, they offer financial concessions for investors in the tech sector.
Classed by the European Union as a European Outermost region, the Canary Islands enjoy a unique “economic and fiscal regime”, which permits a corporate tax rate of 4%.
Companies may also claim a special tax deduction for research and development and technological innovation.
This means companies can claim back between 35-55% (and up to 90% in some cases) on investments from the Spanish tax authorities.
In exceptional cases, they can claw back 90% on investments depending on a series of factors including the workforce and the deviation compared to the previous year.
These schemes are legal cash-back programmes designed to help investors as the Canary Islands is classified by the European Union as an Outermost Region.
Companies operate in a safe environment with qualified employees which is attractive for international expatriates.
For all these reasons, the Canary Islands have proved attractive for companies which have moved there.
Alberto Medina Díaz, the investment relations executive from BDKapital, a crowdfunding and crowdlending platform, said it was crucial for the company to be based in the Canary Islands.
“For a company like BDKapital it is vital to be in the Canary Islands due to the tax advantages that the archipelago presents due to its status as an outermost region, granted by the European Union. Among these advantages are the Canary Islands Special Zone (ZEC) which has the best taxation in the entire euro zone,” he said.
“There is no other region that can offer so many advantages to the investors and promoters who use our platform, with a strategic geographical which combines the union of three continents: Africa, Europe and America.”
Manuel Sánchez-Cascado, CEO of Tech University Technologica, which is the largest Spanish-language technological university in the world with nearly 100,000 pupils in online programmes, is also based.
However, he said it is not only the tax benefits which make it the islands’ the most desirable location for the company.
“The main advantage is the tax repercussion and implementation and current costs of around 40% below continental Europe,” he added.
“The islands’ infrastructure, their location, their legal security and the costs they entail represent an extraordinary long-term competitive advantage in terms of efficiency.”
Mercedes Preckler is the CEO of Open Canarias, a company with over 20 years experience in the implementation of IT services and technology services with the focus on digital transformation for private companies and public bodies.
“A company like ours that is dedicated to ICT products of high technological value with a continuous commitment to R&D&I has tax advantages (in the Canary Islands),” she said.
Companies looking for stability and certainty, the full EU legal framework, major R&D incentives, not to mention a great quality of life for workers, should look to the Canary Islands.
