October 2013 Archive

Is Spain out of the crisis?

As for most of Europe the
answer is undoubtedly
  – No. According
to Prime Minister Mariano Rajoy, in a Wall Street Journal interview recently.
Spain is officially out of recession but like the rest of Europe, not out of crisis.
The facts seem to be these. At the end of Spain’s property boom, there was a
drop in incomes, and a depressed demand for goods.
  One adult in four isn’t in work, and so, consumption has steadily
fallen. Allegedly, Spain still has over 25% unemployment with 54% of these
under 25 years of age, the majority of which still live at home. Keep in mind
that the labour laws in Spain make it very difficult for the employer to fire
people, so naturally keep it to a minimum.
 However, Spain has a massive black economy accounting for around 15% of
the unemployed.
  When you come to Spain
you don’t see that many people out of work!
 So how can Spain have over 25% real unemployment? I don’t think so!

At the same time, property apart,
prices haven’t come down. There’s a debt overhang and Spain struggles to borrow
but still manages to do so. Tight credit for larger companies mean they delay
payments to smaller companies even more but are always historically slow. There
is some positive news though – there seems to be some light at the end of the
tunnel, as orders start to grow for manufacturers. Businesses have reported an
increase in orders, driven by a marked rise in new business from abroad.

However, while output, employment
and purchasing activity still fell, it was at a slower rate than before.

The seasonally adjusted Markit
Purchasing Manager’s Index – a composite indicator designed to measure the
performance of the manufacturing facet of the economy in Spain – posted 50.0 in
June, signaling no change in business conditions. May had a reading of 48.1
which ended a 25 month sequence of deteriorating operating conditions,
according to the financial information services suppliers.

The stabilization of business
conditions was aided by a rise in new orders, the first since April 2011. New
orders from abroad rose for a second successive month, and at a faster pace
than had been experienced for two years.

Respondents indicated that higher
new business has been received from a range of international markets. Higher
new orders contributed to a slowdown in the rate of production decline in June.
Although output continued to fall, the latest marginal reduction was the
weakest in the current 26 month sequence of contraction.

Meanwhile, backlogs of work
increased slightly – the first accumulation of outstanding business since
January 2011. For the third successive month, the rate of job cuts in
manufacturing, eased in June. The latest fall in employment was the slowest
since November 2010.

The rate of decline in purchasing
activity also slowed during the month, and again this was linked to the rise in
new orders. Input costs fell for the fourth consecutive month, with panellists
reporting declining raw material prices. Even so, the pace of reduction can
only be described as modest. Output charges also decreased in June, through a
mix of lower input costs and strong competition. Output prices have reduced in
each month since August 2011.

A reluctance to hold inventories,
was again a feature of respondent reports about manufacturing, during June.
They reported too that a lack of stocks at suppliers had been the main reason
for the lengthening of delivery times.

Clearly as with most of Europe’s economies, there are
many problems to still solve. Last year the government’s spending exceeded tax
revenue by 10.6%, and that cannot continue. Then, last year the population of
Spain fell for the first time in modern history. It seems many young Spaniards
are leaving to work and live abroad. 

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Posted by on 10/31/2013 10:58:00

Whats the chance of renting your property in Moraira

If you have a property in Teulada-Moraira – perhaps it’s a holiday home that’s vacant for much of the summer – and you would welcome the chance to defray some of the costs of ownership – then all available statistics suggest that the renting of your property is a real possibility for you.

The occupation rates for Teulada-Moraira were higher than those of 2012 – 93.33% in August, up from 87.48% last year and 80.44% in 2011. In July this year it was 73.3% versus 71% in 2012, and 64.41% in 2011. The June figures show no major change – the 52.25% of 2013 was slightly lower than the 55.76% of 2012, but up on the 46.11% of 2011.

In June, July and August this year a total of over 15000 enquiries were made at our Office of Tourism by over 7000 people. This far exceeds the number of previous years. Undoubtedly the new Town Hall location is a factor in the increase, but so is the larger number of visitors to Teulada-Moraira.

It’s interesting to note that French tourists were the most common this year, followed by the UK and Germany. There were lots of newcomers from Eastern Europe and Scandinavia, and it was good to see a surge in Spanish visitor numbers, many from other parts of the Valencian Community. Clearly owners need to take this into account when planning the marketing of their property to attract renters.

Local mayor Antoni Joan Bertomeu declared himself to be very happy with the tourism results for 2013, but pledged more effort to continue the trend during the next year. He also declared that new leisure alternatives would be put in place, to allow visitors to enjoy Teulada-Moraira all year and not just in the summer months.

The Town Council is working on a series of projects to make the area an even more attractive proposition to visitors. For example, a lot of money is going into a local street repair programme – 100000 euros to be precise. Not only will the improved road surface be better for our elderly motor vehicles and people, but it will continue to upgrade the appearance of the holiday resort of Teulada-Moraira.

Then, in an area called La Sabatera, a 5000+ square meter plot of land is being developed as a green zone. Rustic wooden benches will be installed, and a railing will be finally positioned around the perimeter, after pine and carob trees are pruned back. All this activity will give citizens and visitors a place to picnic and relax alongside nature.

Last but not least, a campaign to remove rocks from L’Ampolla beach is underway. These rocks and stones are a nuisance for bathers, and the initiative is designed to make bathing there a more pleasant experience in the summer and the rest of the year too.

So it does seem that visitor statistics and the council’s investment in improvements to the area, make the renting of your property an excellent possibility, providing it is well marketed.

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Posted by on 10/23/2013 17:07:00

Spain and offshore Assets

Like most governments in such difficult economic times, the Spanish government is trying to increase tax revenues and has firmly set its sights on offshore assets. There is nothing wrong with owning assets outside Spain, but you need to ensure you declare them according to the rules of Spanish legislation.

 It’s clear that there’s an international move towards the automatic exchange of information, and without doubt, that will provide governments with much more data on undeclared or misrepresented foreign assets and income. The G5 (Spain, UK, France, Germany and Italy) has announced a pilot scheme for the multilateral, automatic and standardized exchange of tax information.

Additionally, in September, the G20 agreed to the introduction of the automatic exchange of asset information, so it does seem to be only a matter of time before details of undisclosed foreign assets will be uncovered

Some people who meet Spain’s residency criteria, do not declare themselves for tax. The tax agency (Agencia Tributaria) has been cracking down on this. They are known to be looking through utility bills and studying lists of foreign children registered in local schools. Then, there is evidence that the tax authority is using information from abroad, and is writing to residents suspected of having undeclared funds abroad.

The Voluntary Disclosure Procedure was a tax amnesty, available last year, designed to encourage taxpayers to regularize undeclared assets. The Agencia Tributaria is now following this up, asking for proof of the source of funds or clarification on discrepancies with data already on file.

In October 2012, the government introduced its new anti-tax fraud law. Included in this, was the obligation to report assets held outside Spain, using Form 720. Speaking in May, Prime Minister Mariano Rajoy said that over 130000 taxpayers had submitted Form 720, declaring assets worth 87 billion euros. However, the Union of Tax Inspectors (GESTHA) reckons the is a derisory number, since there are around 2.6 million foreign residents alone – the group most likely to have overseas assets.

Clearly the taxation of Spain’s foreign residents has been given a lot of effort. It’s doubtful this effort will lessen. Consequently, this raises the question whether or not it’s worth UK nationals moving to Spain, given all the tax increase measures being put in place.

Undoubtedly the answer is a resounding "Si” . However you are advised to acquire some professional advice on taxation in Spain, relevant to your particular circumstances. 


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Posted by on 10/21/2013 15:07:00

Costa Blanca Walking

If your location for retirement is
the Moraira area – look around you and you’ll see mountains. Many of them can
be walked, but it needs to be stressed, in no uncertain terms, that a good
level of fitness is needed.

Additionally, if you’re new to this
kind of activity, it would be a good idea to first attach yourself to an
organisation of considerable experience and expertise in the intricacies of
mountain walking/hiking. Go to www.costablancamountainfriends.com    and you’ll find contact details.

Some of their hiking routes use
recent man made paths, but in some cases, ancient trails that reach into the
heart of the mountains are utilised. These take you through small Valencian villages,
where the Spanish dialect is extremely hard to understand. They take you past
numerous Christan and Moorish castles too.

Some of their more adventurous walks
and hikes follow animal tracks and involve the exploration of river beds and
hidden barrancos (ravines). These off the beaten track routes often allow you
to see eagles, deers, wild boars, foxes, and goats in their natural habitat.
The further inland you go, the more secluded it becomes, without sight of other
people for much of the day. However you are treated to the spectacle of amazing
mountain flora colours and varieties, and of course, the views are

If you fancy walks without any
formal organisation, then the Rock of Ifach might appeal, since Its Calpe
location is easy to reach. The name was coined by Phoenicians and means
“Northern Rock”, distinguishing it from Gibraltar much further south. It’s 332m
high and the top can be reached by a zigzagging path, revealing a magnificent
view along the Marina Alta coastline.

Alternatively, drive to the car park
of the Bernia Restaurant, and you’ll find the start point for 6 possible walks
along and around the Bernia Ridge. Don’t forget – whatever walk you embark
upon, please take a good supply of energy food and water. This is a prudent
thing to do, and in the case of the water, will ensure that no dehydration is

Of course, it’s important to point
out that the walk/hiking options mentioned here are not the only ones
available. The intention is to give you a start point for your research, if you
fancy spending some of you retirement on this pastime.


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Posted by on 10/14/2013 17:35:00

Do politicians know what a billion actually is

Our Chancellor of the Exchequer has
just sold £3.3 billions of Lloyds Bank shares for us. You will recall in
October 1998, we taxpayers were made to bail out Lloyds Bank to the tune of £20

It seems this £3.3 billions windfall
will be used to reduce national debt by around £600 millions – but wait a
minute. Mr. Nick Clegg has declared that all children, in the first 3 years of
primary school, will be given free meals – and the cost of that handshake to
voters is £600 millions.

Now don’t misunderstand me. It’s
obviously a good policy, to give some relief to poorer families. But unless
some miracle occurred when I was asleep, the UK  is still deep in debt. We are still in the cloying mire. The
nation owes many billions of pounds.

Now, on reading this news, I was
trying to comprehend what £3.3 billions was like – then I read something that
put the number into perspective for me. I pass it on to you and to all the
politicians in all countries……


 A billion seconds ago, it was 1959.


A billion minutes ago,
Jesus was alive.


A billion hours ago, our
ancestors were living in the stone age.


A billion days ago,
no-one walked on earth on two feet.


A billion pounds ago, was
only 13 hours and 12 minutes………… at the rate our government is spending it.

OK check my mathematics if you like.
There may be some exaggeration, but the point is still valid.

Sad to say, I do not believe many of
our politicians, have any idea just how large a number a billion is, and
consequently I do not like the thought of them deciding how to spend our tax

Sad to say, there are now over 20 tax categories that
did not exist over 100 years ago, from VAT, Petrol/diesel Tax to Landfill Tax
and TV License. Oddly, 100 years ago, the UK was one of the most prosperous
nations in the world. Then the UK had no national debt whatsoever. Parents were
allowed to discipline their children. A criminal’s life was an uncomfortable
one. What the hell happened ?

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Posted by on 10/07/2013 14:55:00