Azopardi and Picardo CLASH over Tax Treaty with Spain

Opposition leader Keith Azopardi and Chief Minister Fabian Picardo have clashed over the Tax Treaty with Spain.

It follows Mr Azopardi having given notice yesterday that he proposes to move a motion in Parliament, which elicited a quick response from Mr Picardo, chastising the Leader of the Opposition. 


Azopardi's motion reads as follows:

"THIS HOUSE: NOTES the International Agreement on Taxation and the Protection of Financial Interests entered into on the 4 March 2019 between the Kingdom of Spain and the United Kingdom of Great Britain and Northern Ireland regarding Gibraltar (the "Tax Treaty") and signed by the Rt Hon David Lidington MP, the Chancellor of the Duchy of Lancaster, on behalf of Gibraltar AND;

CONSIDERS that the Tax Treaty is intrusive and harmful to Gibraltar's interests AND;

RESOLVES that the Tax Treaty should be replaced at the earliest opportunity with a neutral and fair tax treaty based on the OECD model tax treaty."

In a separate statement, Azopardi says that the Tax Treaty signed with Spain is “intrusive and harmful” and that it should be replaced with a neutral and fair treaty based on the OECD Model tax treaty.

He adds: "The GSD position on the Tax Treaty signed with Spain is well-known. We think this is a deal that is bad for Gibraltarians and bad for

business.It is intrusive and harmful. It is a disincentive for inward investment and it treats Gibraltarians who return home from Spain unfairly and as if they were still Spanish tax residents for four years.

"There has not been an opportunity to properly debate this Treaty that was entered into with the Gibraltar Government’s consent without showing it first to Parliament here and in breach of Mr Picardo’s commitment to the Opposition.

This Motion will now allow our Parliament to finally debate this Treaty in a full and proper way. We have no doubt that this deal with Spain was a bad deal for Gibraltar and we look forward to the debate so we can set this out in detail.”


For his part, Picardo says that the Government notes the private members’ motion set down by the Leader of the Opposition in relation to the Tax Treaty with Spain.

He said: “It seems to me that whilst we in the Government are diligently working to ensure Gibraltar deals effectively with the many challenges we are presently facing, the Leader of the Opposition just wants to play party political games and to hear his own voice repeating the arguments he put and that people rejected at the last election.

"In his latest motion what he is doing is suggesting that he would have been able to negotiate a better tax treaty with Spain than my team. Given he could not even persuade more than a quarter of those voting at the last election to choose his team, and that he wasn’t even able to top the poll for his Party, I am surprised he thinks he could have persuaded anyone in any negotiation of anything more effectively than my team did.

"The fact of the matter is that it is very easy for Mr Azzopardi to sit on the side lines, throw stones and say that we should have negotiated something better – but most people will see he is just being opportunistic and not putting Gibraltar first. What most people know is that we in the Government are doing everything possible to steer Gibraltar safely and securely through our departure from the EU and ensuring our nation’s prosperity in the process.

"Mr Azopardi, however, seems keener to talk about putting in place mechanisms to help Spanish residents to avoid existing Spanish tax rules – all of the things we say we are not involved in doing as a finance centre! I shall very much look forward to the debate in Parliament and to seeing the text of the motion that Parliament finally approves when it hears both of our arguments.”