Favorable Conditions for Business on Tenerife in 2025
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Favorable Conditions for Business on Tenerife in 2025

Tenerife, the largest of Spain's Canary Islands, offers a strategic and attractive environment for international businesses. With a unique tax regime, well-developed infrastructure, and access to European and African markets, Tenerife provides entrepreneurs with opportunities to grow their ventures in a stable and competitive environment.


Mountain Near Body Of Water

Key Advantages of Doing Business in Tenerife


  1. Reduced Tax Rates:

    • Tenerife benefits from the Canary Islands Special Zone (ZEC), which offers a corporate tax rate as low as 4%, significantly lower than the standard Spanish corporate tax rate of 25%.

    • Businesses can also benefit from reduced VAT (locally known as IGIC) at a rate of 7%, compared to the mainland Spain VAT rate of 21%.

  2. Incentives for Innovation and Investment:

    • Generous tax deductions are available for R&D and technological innovation projects, encouraging companies to invest in advanced technologies.

    • Access to EU funding programs and incentives for businesses operating in sectors like renewable energy, IT, and tourism.

  3. Strategic Geographic Location:

    • Tenerife is strategically located between Europe, Africa, and the Americas, making it an ideal hub for businesses seeking to operate in multiple continents.

    • The island has modern ports and airports, facilitating international trade and logistics.

  4. Access to the EU Market:

    • As part of Spain and the European Union, Tenerife offers seamless access to the EU market while maintaining close ties with North and West Africa.

  5. Highly Skilled and Multilingual Workforce:

    • Tenerife provides access to a diverse, educated workforce fluent in multiple languages, including Spanish, English, and German, which is ideal for tourism and international businesses.

  6. Business-Friendly Environment:

    • Simplified processes for business registration and strong local government support encourage entrepreneurial activity.

    • Residency permits are easier to obtain for business owners and their families, facilitating relocation to the island.

  7. Quality of Life and Infrastructure:

    • Tenerife boasts an excellent quality of life, with a favorable climate, affordable living costs, and a vibrant cultural scene.

    • The island has modern infrastructure, including high-speed internet, reliable utilities, and world-class business facilities.

  8. Support for Specific Sectors:

    • Tourism and Hospitality: As a top global tourist destination, Tenerife offers unparalleled opportunities in the hospitality and tourism industries.

    • Renewable Energy: Tenerife is heavily investing in renewable energy projects, making it a hub for green businesses.

    • Film and Media Production: Generous incentives for film production have positioned Tenerife as a leading location for the film and media industry in Europe.


Why Choose Tenerife for Business in 2025?


  • Tax Efficiency: Businesses can significantly reduce operating costs through ZEC and other tax incentives.

  • Proximity to Emerging Markets: Tenerife’s location offers direct access to African markets and connections to Europe and Latin America.

  • Lifestyle Advantages: Combining a thriving business environment with an excellent quality of life, Tenerife attracts talent and investment from around the world.


Tenerife provides a compelling combination of tax benefits, strategic location, and business-friendly policies, making it an ideal destination for international entrepreneurs and established companies in 2025. Whether you’re in technology, tourism, or renewable energy, Tenerife offers the resources, support, and opportunities to thrive in a competitive global market.

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