The Gibraltar Chamber of Commerce and the Gibraltar Federation of Small Businesses have both welcomed the Government’s confidence in the current state of the economy, but are disappointed that many of the increases announced in this year’s budget are “significantly higher” than the current rate of inflation of 2 ½ per cent.
They add that, with the continued uncertainty of what Brexit might bring, coupled with continued competition from unregulated businesses from across the border, it “seems unreasonable” for local businesses to be forced to bear a disproportionate share of these cost increases.
A statement continued: “When social insurance costs were increased last year, the Government said that the increase had to be a double digit increase to catch up after so many years without an increase. At that time, government informed the Chamber that the 10% increase was a one off and future increases would be in line with inflation. Despite this assurance to the Chamber, this year the social insurance costs have increased by 10 per cent or four times the rate of inflation, a total increase of 20% in just over 15 months.
“In his May Day address this year the Chief Minister announced that his government had increased the minimum wage by 20 per cent in the last 6 years. Inflation over the same period was just 10 per cent. It is the employers who have to pay for these increases. Very few small local businesses have seen their sales grow by 20 per cent or even 10 per cent in the last year. These businesses cannot just hike their prices as even more people would shop in Spain or buy from the increasing number of unlicensed businesses from across the border.
“Nevertheless, other measures announced by the Government are welcome. These include the increase in the prompt payment discount for retail and distributive trades following representations from the Chamber and the GFSB. The review of the import duty tariff structure is also welcome and we hope that the Government engages both organisations to arrive at a more streamlined and simplified structure.
“The Chamber and the GFSB are encouraged by the comments made by Sir Joe Bossano in relation to the public sector, namely that the rising costs of the civil service are impossible to sustain economically and difficult to justify socially, even without Brexit. This is something we have been saying for many years and the burden of these rising public sector costs have fallen largely on the private sector. Our members look forward to improved efficiencies from the civil service as well as affordable pay increases in the future.
“Both the Chamber and the Federation would like to re-iterate the impartiality of their respective organisations and urge the Government to address the issues which their members have raised. This is so that all sectors of the local business community can look forward to a bright, competitive and efficient future.”
Following the publication of HMGoG’s guidance on NIF and EORI registration requirements, the GFSB has produced a practical step-by-step playbook to help Gibraltar businesses navigate the process as clearly and confidently as possible. Over recent weeks, many members have contacted us with questions around whether they need a NIF or EORI number, what the process involves, and whether obtaining these registrations could create Spanish tax obligations.
After weeks of questions, confusion and growing concern amongst Gibraltar businesses, HM Government has now published formal guidance on NIF and EORI registration requirements linked to the future customs arrangements under the treaty. This is the clearest explanation yet of what these registrations are, who actually needs them, and perhaps most importantly, what they do not mean.
Gibraltar may be entering a different phase of its development. The expected implementation of the UK-EU Treaty, together with anticipated changes to Gibraltar’s residency rules, could alter the profile of people looking at Gibraltar as a base. If financial thresholds rise, Gibraltar may attract fewer casual applicants and a more concentrated group of internationally mobile, high-value residents. That could include the ultra high net worth market.
This week’s ThriveEDIT member Q&A spotlights Gin on the Rock Ltd, trading as Spirit of the Rock, a micro distillery based in the heart of Gibraltar’s old town, producing world-class spirits and hosting the Gibraltar Gin Experience. With a focus on authenticity, sustainability and products actually made in Gibraltar, this is a business that brings together local craft, visitor experience and plenty of personality.
As we approach the expected provisional application of the Treaty on 15 July 2026, one of the unresolved questions is: what happens to the businesses, entrepreneurs and economically active individuals who want to relocate here but cannot yet see a clear route through the residency system?