Spanish Tax Authority Holds Leasing Activities Do Not Qualify as Industrial Activities for Capital Gains Exemption on Shares Under Swiss Tax Treaty

A ruling from Spain's General Directorate of Taxes was recently published concerning the exemptions from the taxation of capital gains by the source State under the 1966 Spain-Switzerland tax treaty. The ruling is in response to a request by a natural person resident in Switzerland that had sold their shares in a Spanish company that derived more than 50% of its value from immovable property in Spain. The Swiss resident sought clarification on whether the gain was taxable in Spain, considerin…