In more than 90 countries

The consumer

Consumer Profile
The median age has risen sharply since 1970 and reached 44.9 years in 2020. The population is ageing very quickly and is growing at a rate of 0.60%. Almost 15 % of the population is under 14 while more than 65% of the population is between 15 to 65 years old and nearly 20% is over 65 years old. On average, households are made up of 2.5 people in 2019; with 25.7% of households made up of only one person and 54.5% are couples with or without children, according to the latest survey by Instituto Nacional de Estadistica. More than 51% of the population are women. About 80.3% of the population lives in urban areas. Most of the population lives in the agglomerations along the Mediterranean and the Atlantic Ocean, but also in Madrid, Seville and Zaragoza. The three main cities in terms of population are Madrid, Barcelona and Valencia. The OECD estimates that 47% of adults aged 25 to 34 have a tertiary degree in Spain compared to 45% on average across OECD countries. On average, 36% of all upper secondary students enroll in Vocational Education and Training (VET) programmes in Spain, a lower proportion than the OECD average of 42%. Some 29% of the active population work in domestic activities (household), 20.5% work in personal services, 16% in social services activities, 13.2% in sports, recreation and entertainment, 8.9% in associative activities , 4.5% in the repair of computers and household items, 3.9% in creative, artistic and entertainment activities, 2.3% in games of chance, 1% in archival, museum and cultural activities and 0.23% in organizational activities.
Purchasing Power
The GDP per capita PPP is $ 42,214.13 in 2019, according to the latest data by the World Bank. Data from Spain’s statistical institute (INE) shows Spanish workers earn an average of €23,000 a year. Although the average gross salary for men is 26,391 euros, whereas for women is only 20,607 euros. The Gini index on income inequality is 33 in 2019. Between 2005 and 2018, purchasing power parity in Spain was decreasing on average by 1.33% each year. Since then, it has not increased, since wage developments have not kept pace with rising prices. According to the World Bank, in 2019, the purchasing power parity was 0.6 LCU per international dollars. In Spain, the average household net-adjusted disposable income per capita is USD 23 999 a year, less than the OECD average of USD 33 604 a year. Private consumption reached 1.1% in 2019. However, according to the forecasts presented by the Spanish government in May 2020, private consumption forecasts show a decline of more than nine percentage points for 2020.
Consumer Behaviour
Spain is a consumer society. As a result of the economic crisis and the level of unemployment, price has become one of the main purchase determinants. The ease of payment, promotions and effective customer service are other key factors. On average, the Spanish shops two to three times a week, although around 50% of sales take place on the weekend. Price hypersensitivity results in a lack of brand loyalty. 75% of Spaniards look for a bargain before buying something, while 24% leave their regular retailer if they find lower prices elsewhere.

Television is one of the best media in Spain when it comes to spreading the news about brands. 99.7% of Spaniards own a television, but the television advertising industry is competitive and expensive. Radio is also very popular. 60% of Spaniards listen to radio every day for at least two hours. About 85% of Internet users between the ages of 16 and 65 are active on social networks, and the opinion of an influencer or other consumers will sometimes influence purchasing decisions. Spaniards are among the Europeans most concerned about personal data protection with  47% expressing their lack in confidence.

On average, Spaniards spend 328 euros a month on food and 554 euros a year on fashion items. There are 38 million internet users in Spain, making ecommerce a huge market. Ecommerce market value was estimated at 30.3 billion in 2019, and the most popular purchases on the internet are fashion items. Spain has embraced mobile shopping, which accounts for 38%, or €11.5 billion, of e-commerce sales. Even if the imported products are widely consumed in Spain, the national products inspired by Spanish culture (in the packaging for example) are generally preferred.

Responsible consumption is developing in Spain. The number of consumers looking for more responsible products, traceability and better quality is increasing. The second-hand market is becoming increasingly popular among Spanish consumers. Collaborative economy platforms are developing in Spain and the Spanish Competition Authority (CNMC) has been supportive. 49% of the surveyed Spaniards answered that they used the second-hand app Wallapop to purchase this type of products.
Consumer Recourse to Credit
In Spain, the vast majority of residents use debit cards to pay for goods and services. Credit cards are not as widespread but their use is growing. Overall household debt is down in Spain, reaching 60.8% of the country's GDP. This is due to the fact that mortgages are down, and that this has not been offset by the rise in consumer credit. Household debt is made up of around 80% mortgages and 20% consumer loans. The outstanding amount of these is 85 billion euros in 2018. Consumer loans are mainly used to finance vehicles, durable goods and holidays. Competition in the consumer credit market, with the arrival of digital platforms, is pushing credit institutions to make low-cost offers, and the demand for credit could therefore continue to increase. However, the central bank of Spain remains vigilant and considers that if it jeopardises banking stability it could intervene.
Growing Sectors
Leisure and culture, vehicles, accommodation and food services, furniture and carpets, telephones, education, home and garden equipment, clothing.
Consumers Associations
OCU , Organisation for Consumers and Users
ASGECO , Organisation for Consumers and Users
CECU , Confédération des consommateurs et utilisateurs
FACUA , Federation of Active Consumers


Importing & Distributing

Import Procedures
As Spain is part of the EU countries, a common commercial policy is adopted to import/export most products. The Agencia Tributaria manages the Spanish customs service. It is responsible for the administration of customs procedures in Spain, the collection of taxes and VAT, work for the economic development of Spain, the control of illegal trade and are facilitators of real trade.

The official model for written declarations to customs is the Single Administrative Document (SAD). The SAD serves as the EU importer's declaration.  It encompasses both customs duties and VAT and is valid in all EU Member States.

As part of the "SAFE" standards advocated by the World Customs Organisation (WCO), the European Union has set up a new system of import controls, the "Import Control System" (ICS), which aims to secure the flow of goods at the time of their entry into the customs territory of the EU. This control system, part of the Community Programme eCustoms, has been in force since 1 January 2011. Since then, operators are required to pass an Entry Summary Declaration (ENS) to the customs of the country of entry, prior to the introduction of goods into the customs territory of the European Union.

Non-agricultural goods entering EU territory must adhere to customs formalities (ENS). This declaration must be carried out by the person bringing the goods to the territory. The Summary Declaration can be made electronically or on a form provided by the customs authorities. The deadline for lodging the ENS depends on the mode of transport carrying the goods.

Since July 1, 2009, all companies established outside of the EU are required to have an EORI number if they wish to lodge a customs declaration or an Entry/Exit Summary declaration. Once a company has received an EORI number, it can use it for exports to any of the 28 EU Member States.

Goods in transit only need a single EU transit document.

Inward processing is free of customs treatment. This procedure allows raw material (non-Union good) to enter temporarily without customs fees if it will be processed (or repaired) and re-export the finished products out of the EU territory. In this case, the importer gives a guarantee (from an insurance company or bank) equal to the amount of customs duties that would have been due on the imported raw material. This guarantee will be reimbursed when the final product is exported. This process also applies to goods planned to be re-exported. Only goods sold in the EU market are eligible to import duty and taxes.

For outward processing, duties and taxes apply only to the value added during the process. Only firms located in Spain or in the EU may take advantage of this measure.

The EU plans to introduce a new import control system called ICS2 that will start on 15 March 2021 to implement the EU customs pre-arrival security and safety programme.

For more information, please visit the website of the EU on customs policy.
Specific Import Procedures

The Union Custom Code - adopted on 9 October 2013 as Regulation (EU) No 952/2013 - Title V provides for the following customs simplifications:

  • Simplified declaration (Article 166 UCC)
  • Centralised clearance (Article 179 UCC)
  • Entry in the declarant's records (Article 182 UCC). This type of customs declaration is not allowed for all customs procedures (e.g. exclusion of transit).
  • Drawing-up of customs declarations for goods falling under different tariff subheadings ( Article 177 UCC)
  • Self-assessment (Article 185 UCC)
Distribution channels
Both globally and nationally, the scope and impact of COVID-19 remains uncertain and rapidly evolving. The retail competitive landscape in Spain remained highly diversified in 2019, led by major grocery retailers. Grocery retail is the most important retail channel in Spain, representing 52% of total store-based retailing value sales. In 2019, the food processing industry recorded a turnover of $135 billion, accounting for 2.1% of GDP.

While hypermarkets and larger sized supermarkets control a large share of sales, small sized supermarkets located in urban areas are becoming ever more popular due to their proximity to the consumer (generally located within walking distance of residential and/or business areas). According to Euromonitor, in 2019, supermarket sales increased by 4% in current value terms to reach 60.3 billion euros. Supermarket sales are expected to increase 3% in the next five years.

Convenience stores are very popular for last minute purchases. The sales through this kind of store have largely benefited from increasingly busy lifestyles. The main advantage pointed out by convenience store consumers include their opening hours (open longer hours than other stores). However, these stores are going through a rough time due to their high prices.

Traditional markets are composed of corner grocery stores, open-air markets and regional markets. Wholesalers are the main suppliers for traditional markets. Usually, the corner grocery stores are family owned and located within residential and/or neighborhood areas. Although they are small, they usually carry a diversified range of food and cleaning products. Sanitary conditions are good and most have a small refrigeration area. Although their prices are usually higher than in any other type of outlet, they are quite popular for their high quality fresh produce and their proximity.

The competitive environment in internet retailing remains extremely fragmented, although the leading retail channel in 2016 remained Amazon with a 6 percent value share of the market. According to Euromonitor, food and drink products are the most popular product type sold via internet retailing in Spain. More families, particularly in the big urban areas, save time buying their groceries online. Still, the importance of internet retailing within grocery retailing has plenty of room to grow.
Distribution market players

Distribution in Spain is still characterized by a large number of retailers and traditional stores. Hypermarkets/supermarkets, convenience stores, major discount stores and specialized stores coexist with traditional corner grocery stores and open-air markets.
Grocery retail distribution is dominated by:

  • Mercadona SA (supermarkets) with $ 26,499 million sales in 2019
  • Carrefour (hypermarkets, supermarkets, discount stores) with $ 9,988 million sales in 2019.
  • Grupo Eroski (hypermarkets and supermarkets) with $ 5,333 million sales in 2019
  • Auchan retail with $ 5,200 million sales in 2019
  • Lidl supermercados (discount store) with $ 5,108 million sales in 2019
  • Dia retail (discount store) with $ 4,741 million sales in 2019
Retail Sector Organisations
National Association of Mass Distribution Companies (ANGED)
Spanish Food and Drink Industry Federation
Spanish Chamber of Commerce


Operating a Business

Type of companies

Sociedad de Responsabilidad Limitada or S.R.L. (limited liability company)
Number of partners: Minimum 1 partner.
Capital (max/min): 3,000 EUR minimum fully subscribed and paid upfront.
Shareholders and liability: Responsibility limited to the contribution amount.
Sociedad Anonima or S.A. (limited company)
Number of partners: Minimum 1 partner.
Capital (max/min): 60,000 EUR minimum, fully paid up minimum up to 25% of the total constituted amount.
Shareholders and liability: Responsibility limited to the contribution amount.
Sociedad Colectiva (company in a group's name)
Number of partners: Minimum 2 partners.
Capital (max/min): No minimum capital.
Shareholders and liability: Liability is joint and several and unlimited towards third parties.
Sociedad comenditaria (Limited partnership company)
Number of partners: Minimum 2 partners. There are 2 types of partners, general partners and limited liability partners.
Capital (max/min): No minimum capital.
Shareholders and liability: Unlimited liability for general partners; liability limited to the contribution amount for the limited liability partners.
Setting Up a Company Spain OECD
Procedures (number) 7.0 5.2
Time (days) 12.5 9.5

Source: Doing Business - Latest available data.


Cost of Labour

Minimum Wage
In 2020, the national minimum wage in Spain is 1,108.3 euros per month, or 13,300 euros per year.
Average Wage
At the end of 2019, the average salary was 1,695 euros, an increase of 1.5% over the previous year.
Social Contributions
Social Security Contributions Paid By Employers: As of January 2020, the employer contribution is 29.9% for general contingencies, plus a variable rate for occupational accidents (e.g. 1.5% for office work).
Social Security Contributions Paid By Employees: The general contribution rates as of January 2020 are 6.35% for employees, depending on the type of contract.

Intellectual Property

National Organisations
Oficina Espanola de Patentes y Marcas for patents and trademark registrations.
Intellectual Property Central Registry
The competencies related to intellectual property were transferred to the Autonomous Communities which have their own registry, in coordination with the State Registry.
Regional Organisations
OEB, European Patent's Office,
EUIPO European Union Intellectual Property Office
International Membership
Member of the WIPO (World Intellectual Property Organization)
Signatory to the Paris Convention For the Protection of Intellectual Property
Membership to the TRIPS agreement - Trade-Related Aspects of Intellectual Property Rights (TRIPS)


Tax Rates

Consumption Taxes

Nature of the Tax
Impuesto sobre el Valor Añadido (IVA) (Value-added tax - VAT)
Tax Rate
Reduced Tax Rate
For certain basic goods and services, a reduced VAT of 10% (e.g. food and drink for human or animal consumption; pharmaceutical products for animals; prescription glasses and contact lenses; certain medical equipment; residential dwellings; passenger transport; hotel and restaurant service; garbage collection; trade fairs and exhibitions; cinema tickets; cultural live shows/entertainment) or 4% (e.g. basic foodstuffs; books, journals and magazines; pharmaceutical products for humans; certain goods and services for handicapped persons) applies.

Exports and international services provided to non-EU countries are zero-rated.

Other Consumption Taxes
Excise duties are chargeable on most hydrocarbon oil products, alcoholic drinks, and tobacco products.

Special Tax on Certain Means of Transport (IEDMT) is required when registering a motor vehicle.

The transfer of real estate is also subject to a VAT of 21%, with a reduced rate for private residential property (10%) and individuals not in the VAT system (6% transfer tax).
In the Canary Islands, a specific tax is applied en lieu of VAT (Canary Island General Indirect Tax - IGIC), at a standard rate of 7% (other rates are 0%, 3%, 9.5%, 15% and 20%). In Ceuta and Melilla, a sales tax is applied instead of VAT.

A gift and inheritance tax is levied on the assets' net acquisition value with progressive rates (which may vary according to the region, generally between 7.65% and 34%). A tax is applied on gaming income.


Corporate Taxes

Company Tax
Tax Rate For Foreign Companies
A company is resident in Spain and subject to corporate income tax on its worldwide income when: it has been incorporated in accordance with Spanish law, its registered office is in Spain, and/or its effective head office is in the country (i.e. when the business activities are managed and controlled from Spain).

If a company is established in a country or territory where no tax is levied or that is a tax haven, such company is deemed resident in Spain for taxation purposes if its core business activity is carried on in Spain or its main assets consist, directly or indirectly, of property located or rights fulfilled or exercised in Spain.

Capital Gains Taxation
Capital gains are usually included in taxable income and are taxed at the standard rate of corporate income tax (25%). 95% of capital gains are exempt from tax if a participation of at least 5% in the subsidiary is held for a one-year period before the disposal of shares, resulting in an effective tax rate of 1.25%. The 5% requirement is deemed to be met if the participation in the subsidiary exceeds EUR 20 million.
Main Allowable Deductions and Tax Credits
Business expenses are generally deductible if incurred for the purpose of earning profit, are properly recorded and documented, and provided that a particular deductibility restriction or limitation does not apply. Payments of real property tax and local surcharges on these taxes are deductible in determining the corporate tax base. All salaries, wages and bonuses paid generally are deductible, as well as severance pay (this last one up to a limit of EUR 1 million/employee). Donations are non-deductible expenses for corporate income tax purposes; however, a tax credit of up to 35% of the donation may be availed for donations to non-profit organisations that comply with certain requirements. Bad debts are deductible, provided certain conditions are met.
Net operating losses may be carried forward indefinitely (capped at 70% of taxable income obtained before the request to carry forward, 50% for taxpayers with a turnover between EUR 20 million and 60 million in the 12 months preceding the request, 25% for companies with a turnover over EUR 60 million in the 12 months preceding the request - no cap applies to companies with net operating losses below EUR 1 million). The carryback of losses is not allowed.

Tax incentives are provided for R&D (25%, or 42% if the expenses are higher than the average R&D expenses incurred by the company during the previous two years, capped at EUR 3 million or EUR 5 million in some exceptional cases) and technological innovation of existing products (12% of the costs, or 50% for SMEs, subject to conditions). An additional tax credit of 17% can be availed of for staff expenses incurred for staff exclusively carrying out and qualified to carry out R&D activities. Special tax treatment is also given to collective investment institutions and companies and venture capital companies and funds.

Other Corporate Taxes
A 1% capital duty tax is levied on capital reductions and company dissolution, and is payable by the shareholders. Payroll tax, real property tax (with rates depending on the region and the property value) and a stamp duty (0.5% for all notarized document, ranges from 0.75% to 3% for other transactions depending on the region and the type of transaction) also apply. A hydrocarbons tax relating to the exploration, research and exploitation of hydrocarbons is also in force.

A transfer tax, ranging from 5% to 11%, depending upon the region (6% on average), is generally levied on inter vivos transfers, including real estate transfers and real estate leases that are exempt from VAT. Transfers of shares generally are exempt from transfer tax.

Companies resident in a tax haven for tax purposes that own real estate or hold real property rights in Spain are subject to a tax equal to 3% of the assessed value of the real estate.

The employer contributes 29.9% of the employee’s wages for social security (23.6% for common contingencies, 5.5% for unemployment, 0.2% for the salary guarantee fund, and 0.6% for professional training), plus a contribution for professional contingencies ranging between 1.5% and 7.15%, depending on the type of activity.

Other taxes include: real estate tax (levied annually by the local authorities), a local tax levied on the increase in the value of urban land (applied at the time of the sale of the urban real estate), motor vehicle tax, waste collection fees.

Other Domestic Resources
Spanish Tax Agency
Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.

Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed
List of double taxation agreements signed by Spain
Withholding Taxes
Dividends: 19%; Interest: 19%; Royalties: 0 (if qualified as business income, when paid to resident companies)/19% for residents of the EU/EEA and 24% for all other non-residents, unless otherwise provided in a tax treaty.