Balearic Government abolishes Inheritance and Gift Tax
The new Government of the Balearic Islands has abolished the Inheritance and Gift Tax (“ISD”) for acquisitions by death or through inheritance agreements (i.e., inheritance, legacy and inheritance in life) made between parents and children, grandchildren and grandparents, and between spouses.
The rule provides that only tax residents in Spain can benefit from this elimination. We believe that this provision clearly discriminates against non-residents and is therefore contrary to the fundamental principles of the European Union.
This measure came into force on 18 July 2023.
Remember that the Balearic Government has announced its intention to reduce the taxation of Wealth Tax, so we will have to keep an eye out for any changes in this regard.
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