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The economy of Gibraltar is managed and controlled by the Government of Gibraltar. Whilst being part of the European Union, the British overseas territory of Gibraltar has a separate legal jurisdiction from the United Kingdom and enjoys a different tax system. The role of the UK Ministry of Defence, which at one time was Gibraltar's main source of income, has declined, with today's economy mainly based on shipping, tourism, financial services, and the Internet.In his June 2009, budget speech, Chief Minister Peter Caruana noted that Gibraltar's economy remains in good shape and Government finances remain healthy, solid, stable and robust, despite global economic and financial turmoil. |
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Gibraltar will soon have a functioning stock exchange, the GibEX.
In December 2008 in a landmark decision the European Court of Justice ruled that:
“...the Court finds that the competent Gibraltar authorities which have devised the tax reform have, from a constitutional point of view, a political and administrative status separate from that of the central government of the United Kingdom.”
This allowed the implementation of a new low tax system which is to take full effect by 2010.
Growth in Economy
The Gibraltar Government state that economy grew in 2004/2005 by 7% to a GDP of £599,180,000. Based on statistics in the 2006 surveys, the Government statisticians estimate it has grown by 8.5% in 2005/6 and by 10.8% in 2006/7 and that the GDP is probably now around 730 million. Inflation was running at 2.6% in 2006 and predicted to be 2% to 3% in 2007. Speaking at the 2007 budget session, Peter Caruana, the Chief Minister said "The scale of Gibraltar's economic success makes it one of the most affluent communities in the entire world."
Taxation
Value added tax
Gibraltar is a VAT free jurisdiction.
Gaming tax (Online gaming)
Levied at the rate of 1% of relevant income (gaming yield for online casinos and bets placed for online bookmakers), capped at £425,000 with a minimum payable of £85,000.
Import duties
Levied on goods imported into Gibraltar, mostly at 12%. Computer equipment is at 6% and photographic equipment duty free.
Excise duties
Levied mainly on spirits, wines, tobacco and mineral oils.
Social insurance, 2010
Corporation tax
Resident Companies Full Rate 22% Small companies Rate 20% Marginal relief 7.5% Small companies’ rate applies if taxable profits do not exceed £35,000 and the company derives at least 80% of its turnover from trading. Between £35,000 and £105,000 the full rate applies less marginal relief on the difference between £105,000 and taxable profits.
