In its statement earlier this week about an anticipated new special economic regime for the Balearics (REB), the regional government referred to the possibility of creating Tax Incentives for Business which invest in the region, something which has, until now, proved to be mission impossible.

These incentives would correspond to the establishment of a business Investment zone in the Balearics similar to that which exists in the Canaries. There would also be an investment pool to allow for reductions in business and income tax. The government will also be proposing specific tax measures for certain investments, such as those in technological innovation, audiovisual productions (filming) and export activities.

Consideration of the document given to national government that outlines these proposals will now wait until a new government is formed, but the Balearic administration is aware of the urgency in approving a new REB, which should have in fact come into effect last year, seven years after it was approved by the state.

The previous administration of José Ramón Bauzá had arrived at what was dubbed a “mini REB”, but this had not involved negotiations with other political parties or non-governmental interested parties. The finance minister, Catalina Cladera, has, therefore, been at pains to meet with various bodies, such as business associations, unions and the Chamber of Commerce, in order to explain the new proposals for the REB. These are to be open to suggestions from all political parties and others so that a broad front is created that will lead to the most ambitious and consensual law possible.