New tax ruling addresses controversial aspects of the Spanish tax regime applicable to qualifying bond offerings.
The Spanish Tax Authorities recently published Binding Tax Ruling V3670-13 (the Ruling), which addressed certain controversial features of the special Spanish tax regime applicable to certain qualifying bond offerings — which is governed by Additional Provision Two of Law 13/1985. The Ruling suggests the Spanish Tax Authorities are taking a market-friendly approach, though additional reforms likely are still required.
The Spanish special tax regime, inter alia, does not apply Spanish withholding tax on interest payments made to non-Spanish resident investors, as well as, among others, listed Spanish companies that issue bonds directly or through a special purpose vehicle (SPV) located in Spain or in another European Union Member State1 (other than a tax haven for Spanish tax purposes).
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