Canary Islands Taxation | EBF Consulting
The Government of the Canary Islands has approved the Consolidated Text of the Canary Islands General Indirect Tax (IGIC) and the Imports and Deliveries of Goods Tax (AIEM) through Legislative Decree 1/2025, dated October 20.
Although not a tax reform, this consolidation updates, simplifies, and unifies the rules governing both taxes, enhancing clarity, consistency, and legal certainty within the Canary Islands’ tax framework.
A Step Toward Greater Regulatory Clarity
The new consolidated text of IGIC and AIEM represents a significant step toward administrative simplification. The main updates focus on terminological coherence, clearer exemptions, and better definition of fiscal benefits for social and sports-related services.
Key Highlights
Clarifications on exemptions for social services, non-profit entities, and sports activities.
- Simplified rate naming, now clearly defined as:
- 5%: reduced rate.
- 3%: super-reduced rate.
Continuation of the zero rate for rebuilding homes affected by the La Palma volcanic eruption.
These measures aim to strengthen legal certainty and support the proper application of the Canary Islands Economic and Fiscal Regime (REF).
Impact for Businesses and Professionals
For businesses and professionals operating within the Canary Islands, this legislative consolidation offers greater legal clarity and reduces interpretative risks in the application of local indirect taxes.
At EBF Consulting, we assist companies in correctly applying the tax benefits and incentives available under the REF framework, ensuring full compliance and optimal fiscal efficiency.
Conclusion
The approval of the Consolidated Text of IGIC and AIEM does not represent a tax increase, but rather a structural update that makes the Canarian tax system more transparent, coherent, and accessible.
At EBF Consulting, we help national and international companies operate confidently and efficiently in the Canary Islands, leveraging the advantages of its Special Economic and Fiscal Regime.