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Cross-border
economic
development 35
Territory portraits: economic development on different borders
France -Spain - Andorra
Comparison of framework
conditions
While a comparison of France and Spain enables us to identify some
differences in framework conditions, overall the systems are not
fundamentally different. In terms of taxes, the level of corporation tax
is similar (around 30%), as is the level of VAT, following increases in both
countries (20% in France and 21% in Spain). Labour costs are higher
in France, however: employers’ contributions are higher (45% of gross
pay in France, compared with 30% in Spain), as is the minimum wage
(€1,430 gross per month, compared with €75363 – equivalent to a 35-
hour week in France, but a 40-hour week in Spain, with no obligation
to pay a higher rate for overtime).
63 Source: Eurostat, 2013.
The situation in Andorra, which borders both France and Spain, is
fundamentally different. Before 2011, Andorra stood out for having a
tax system which did not directly tax the income of natural persons,
commercial profits or inheritance. Andorra introduced a direct taxation
from 2012 (taxing corporate profits, revenue from economic activities
and all income for non-residents), VAT at 4.5% from 2013 and income
tax at 10% (single fixed rate) during 2014. 64
64 Source:
Portrait of a territory
Atlantic Ocean
Mediterranean Sea
50 km
Pyrénées-
Orientales
Hautes-
Pyrénées
Haute-
Garonne
CATALONIA
ARAGON
NAVARRA
LA RIOJA
Ariège
AQUITAINE
LANGUEDOC-
ROUSSILLON
MIDI-PYRÉNÉES
Pyrénées-
Atlantiques
Euroregion Aquitaine-Euskadi
FRANCE
SPAIN
Espace Pourtalet
ANDORRA
Consorcio Transfrontalier
Bidasoa-Txingudi
Pirineus-Cerdanya
Pays d’art et
d’histoire transfrontalier
Conférence Atlantique Transpyrénées
EGTC
EGTC
EGTC
EGTC
EGTC
Barcelona
San Sebastián Toulouse
Bordeaux
BASQUE
COUNTRY
Working Community
of the Pyrenees
Pyrenees Mediterranean
Euroregion
Eurodistrict of
the Transfrontier
Catalan Space
Bayonne-San Sebastián
Basque Eurocity
INTERREG
POCTEFA