Planned tax changes in Spain will be welcomed by small businesses but not appreciated by property owners.

The Spanish government announced recently that it is planning tax measures to assist small and medium sized businesses (SMEs) as well as the self-employed in the early part of 2012. This will certainly come as welcome news to the thousands of family concerns and one-man businesses throughout Spain. It is thought that tax concessions will be granted to entrepreneurs too.

The government is keen also to increase employment and has begun to put in place measures to make hiring and firing less onerous for companies. This in turn has provoked an angry backlash from the unions who condemn the recent severe cuts in severance pay.

Meanwhile, the government has ordered the various local authorities across Spain to increase their rate of council tax or IBI (Impuesto de Bienes Inmuebles). Properties that have a value above the municipality average will primarily be affected, as will properties with a catastral value reviewed before 2002. It seems that the increase will be in the region of 10 per cent. However, the government has said these are temporary increases and should only be for the next two years.

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