Lawmakers also scrapped registration fees and streamlined the process of setting up a business in the country.
On Twitter, Economy Minister Nadia Calvino said the tax incentives and other measures will “attract and retain international and national talents” and make it easier for digital nomads and remote workers to come to Spain.
The incentives will apply to salaried workers, freelancers and Spanish citizens who have lived outside the country for at least five years.
The measures are part of Spain’s new Startups Law for fledgling companies, entrepreneurs, investors and digital nomads. Lawmakers hope the legislation will lure digital professionals from around the world and boost the local startup culture.
“Startups are the foundation of the new digital economy,” Calvino said after a cabinet meeting. “They generate highly skilled jobs and have high growth potential.”
Spain is one of several countries trying to woo digital nomads in the wake of the COVID-19 pandemic. These workers, who tend to be highly educated and well paid, often stay long-term and pour millions of dollars into local economies by renting accommodations, eating in restaurants, paying for services and visiting tourist attractions.
Croatia, Costa Rica, Greece, Georgia, Iceland and Thailand have also recently introduced digital nomad visas to attract this lucrative demographic.
The draft Startup Law has been forwarded to the Spanish parliament for final approval.