Fiscal Profits

We know that the main appeal that moves to a lot of worker companies to interest by Melilla like city to set up , are his special fiscal advantages:

The Law 6/2018, of General Budgets of the State of 2018, “with the aim to contribute to attenuate the effects of his territorial singularity” establishes the types to demand in the Tax on Activities of the Game the City of Melilla with a bonus of the 50 percent. Thus, the article number 48.7.2 remains the following reference:

2. The relative types to the companies with fiscal residence in his territories and really rooted in the Autonomous Cities of Ceuta and Melilla will be:

  • State sports bets, impose by the obligations from the Royal Decree 419/1991, of 27 March, by which regulates the distribution of the collection and prizes of the State sports bets: 22 percent on the taxe base mention on the letter a) of the 6 section of this article.
  • Mutual sports bets, of crusades and compensation; compensation and mutual equestrianism bets; other crusades and compensation of mutual bets: 10 percent on the taxe base mention on the letter b) of the 6 section of this article.
  • Raffles: 10 percent on the taxe base mention on the letter b) of the 6 section of this article., except the declared of public or charitable utility that it pay tribute to the 2,5 percent of the same taxe base.
  • Competition and other games: 10 percent on the taxe base mention on the letter b) of the 6 section of this article.
  • Random combinations with advertising or promotional ends: 5 percent on the same taxe base mention on 6 section of this article.

Likewise, we have the maximum legal certainty regarding the definition of the “worker really based on Melilla” for the purpose of applying the mentioned bonus, since this question has been resolved by Query Vinculante of the General Direction of Tributes, since this issue has been resolved by Taxes Administration, which concludes that the consideration of a worker really based in the Autonomous City of Melilla would require the concurrence of the following requirements:

  • That more than 50 percent of the workers of the companies, that is, of his staff, are ascribed to his headquarters in Ceuta or Melilla and having there his usual residence.
  • That more than the 50 percent of the total staff cost of the company (Payroll) it correspond to the employees belong to his headquarters in Ceuta or Melilla and having there his usual residence.
  • That the set of services received by other companies belonging to the group (group services) does not exceed 50 percent of the total staff cost of the company, and this regardless of the location of the other companies belonging to the group.

But also, any natural person or legal entity with residence Melilla will benefit from the following tax advantages:

  •  50% discount on Societies Tax.
  •  60% discount on the Income Tax, for the icome earned in the city of Melilla
  •  50% discount on the Inheritance Tax, increasing the bonus discount to 99% when the successor are the spouse, ancestors or descendants.
  •  50% discount on Patrimonial Transmissions and Documented Legal Acts
  •  75% discount on Heritage Tax.
  •  50% discount on Municipal Taxes.

In Melilla, VAT is not taxed. Instead, a local tax (IPSI) with a reduced rate of 0.50% is applied for the following services:

  •  Advertising and marketing services.
  •  The electronic services.
  • The accessory and complementary management services for carrying out the gaming activities that constitute the taxable facts of the taxes on the game and random combinations.

So that, an entrepreneur who performs online gaming activities and is established in Melilla will be taxed by IPSI instead of VAT for the services provided by the recipient (advertising, services provided electronically, and game accessories).

Example:

It pays a 353 % less taxes for being in Melilla.

An online game operator has contracted an advertising campaign for € 1.000.000; and, it has received services provided electronically for € 600.000.
The tax base that is taxed in the game tax for the year has been € 2.000.000.

(1) Melilla 0,5 % IPSI; Peninsula 21 % VAT.

(2) Melilla 10 % Game Tax; Peninsula 20%.

50% Discounts on the employer’s contribution to Social Security