Spain – The Sleeping Giant

Spain is a charming country. History sits on your doorstep. Quite literally. Buildings dating back more than a thousand years are still in use. Cave paintings from our distant human relatives abound. It’s all here. But Spain has other qualities that make it’s potential as a powerhouse even greater, and I see it every day.

It’s the right mix of old and new. While the rest of the world in the post-WWII era automated and modernized, Spain was in many ways held back due to it’s Franco-era governance and the rest of the world passing it by for major investment. There was a huge downside to all this. But there was an upside, too.

Just like Portugal, due to late investment in infrastructure means that Spain doesn’t have the same issues faced by other countries that were much further ahead of us. I’m thinking of the now failing US infrastructure. The Spanish government is pushing hard to bring broadband to every community in the country. Our little farm will get it in 2022. No more Moviestar satellite internet. Working from the farm will just get easier.

And this lays the groundwork for some of Spain’s other, more ambitious plans. Historically, it has been very difficult to do business here. The convoluted rules and regulations. The bureaucracy is mind numbing. But that is starting to change, post-pandemic. Enter the new Digital Revolution in Spain.

Laws that will take effect next year will make founding your start-up here a very attractive and lucrative prospect. Even for foreigners. Huge tax incentives for founders. And tax breaks for those who work in them. More in line with what you might see in the US. And there is even more.

During the pandemic, those who could work from anywhere, did. They fled to locations around the world. Sunny, contagion-free, or free-er. But Spain missed out on a lot of this because, even on a non-lucrativo visa, you were not legally allowed to work remotely for a foreign company while living in Spain. But now, that is changing. And I don’t think it’s because I tweeted at our Prime Minister, Pedro Sanchez, back in spring of 2020 about this very topic. Ok. A few times.

When we moved to Spain nearly four years ago (how did that much time go by so fast?) people in the US asked us all the time how we managed that. I have heard ‘it’s impossible to do as a US citizen.’ And ‘You’ll see. They’ll never give you a visa.’ But, surprise! They did. And then the crazy political situation in the US and the pandemic hit. And people reached out to understand how we did it. But now, with the new Digital Nomad visa coming in 2022 it will be even easier. And more cost effective than when we did it.

This new visa allows the bearer to pay less tax. Just 15%. And, in reality, Americans will hardly pay that, because the US has a tax treaty with Spain. No double taxing. First you pay your US taxes. Give those numbers to your Spanish gestoria. Then you pay your Spanish tax, if any. But they want you to come to pump your income into the economy. Buy a house or a flat. The population is declining. Empty Spain is a very real thing. Real estate opportunities abound. There are a lot of Brits forced to sell up due to Brexit. Americans can pick up a nice home on the Med for pennies compared to the US. And your property taxes will be peanuts. Ours for the farm were €242 last year. Seriously. Our annual property taxes in the US were $9,000 a year. It’s simple math. An uncomplicated rudimentary US marketing campaign, and adventurous Americans would eat this up. And it should attract younger people. Not retirees or snowbirds.

The education system here is top notch. There are educated, qualified professionals waiting to use their expertise on the idea for your start up. Especially if it’s medical related. And the country is happy to have you. The cost of living here is <20% of that in Seattle. And the quality of life is 1000% better. Government-run Healthcare is the best in the world. And the people? We have never experienced anything like it before. Neighbors, and even strangers go out of their way for you.

The Spanish government is pumping big money into digital, green energy, and infrastructure. If you have a start-up idea related to any of this they will roll out the red carpet for you.

On the other hand. If you just have a job that allows you to work from anywhere in the world, perhaps a software engineer or the like. And you think maybe you’d like to raise your kids in a more family-friendly, low-crime, neighborly environment with a good education (and they’ll learn español – the second most spoken language in the world), it’s something to seriously consider. I wish it had been an option when our kids were growing up.

Either way, the potential here is enormous. Even with the Covid sixth wave, the Spanish economy is already back to 2019 levels. I am convinced Spain is a sleeping giant. And there are all the signs that she is waking up with post-pandemic EU funds and is ready to hit the ground running. I love the idea that an influx of new idea’s from the outside will help transform the Spanish economy. But also, that those who come here will be transformed themselves, like Jeff and I have been. A truly virtuous circle.