Impact of Brexit in the Canary Islands taxation

The incidence of Brexit in the various taxes whose application corresponds to the Autonomous Community of the Canary Islands has been regulated by the Regional tax authorities in the Resolution of January 28, 2021, which has been published in the Regional Official Gazette of 5 February 2021.

As pointed out by the Resolution, the fact that the United Kingdom is not to be considered a Member State of the European Union since 1^st January 2021, except for the territory of Northern Ireland, with regard to deliveries, intra-community acquisitions and imports of goods, has consequences in various areas of application of Regional taxes such as the General Indirect Tax of the Canary Islands (hereinafter , IGIC) and the “Excise Duty on Imports and Deliveries of Goods in the Canary Islands” (hereinafter, AIEM), namely:

-          Passenger’s regime in IGIC and AIEM,

-          Exemption of IGIC and AIEM to the definitive importation of personal property due to transfer of habitual residence, marriage, death or to furnish the habitual or secondary residence,

-          IGIC location rules of the provision of services (application of the “effective use and enjoyment” to UK companies),

-          IGIC refund to non-established businessmen or professionals,

Besides, a specific mention is also made to the fact that the Brexit will not affect the status of the UK residents as regards the Inheritance tax.