Before the advent of an EU financial transactions tax (FTT), of which Spain has long been a supporter, a draft proposal establishing the potential implementation of a Spanish FTT was published in 2018. Since then Spanish proposals have been slowly simmering, with the political process involving consultation, submission of proposals and approval by the Spanish Parliament.
Now with only a few months’ notice, the new tax is set to make its debut in 2021. The Spanish FTT is scheduled to be effective from 16th January 2021, three months after publication in Spain’s Official Gazette on 16th October. The tax rate levied will be 0.2% and imposed on the acquisitions of shares issued by Spanish companies, subject to certain exemptions. Application also extends to related depositary receipts, and exercise or settlement of convertible bonds, derivatives, and other financial instruments.
Negotiations on the EU-wide tax are still on-going since 2011, and although originally planned for 2016, finance ministers from participating countries continue to debate the technical points from time to time. There is no timetable agreed for when it could come into force. If the wider EU FTT ever moves off the back burner, then the Spanish tax may have to be adapted.