“How can he not win the World Cup if he has Andorran registration? Andorrans are always going faster! ” With this joke on the networks many Andorrans celebrated the victory in the MotoGP World Championship of the Mallorcan rider Joan Mir, who has been living in Andorra for a couple of years. It is not an isolated case: without going any further, up to nine riders in the premier category of motorcycling (Fabio Quartararo, Maverick Viñales, brothers Aleix and Pol Espargaró, Àlex Rins, Jack Miller, Tito Rabat, Iker Leucona and the aforementioned Joan Mir) have established their residence in the country of the Pyrenees.
But how attractive is Andorra to be the space chosen by six of the top ten in the 2020 MotoGP World Championship? The list is long, and even more so if we add motorcycle riders from other categories, such as the trial champion Toni Bou or the Dakarians Cyril Despres –married to an Andorran– and Joan Barrera, or the ex-drivers Bradley Smith and Randy de Puniet –who have been living in the co-principality for many years–, among others.
In fact, a pilot like Marc Márquez, with his residence fixed in his native Cervera and a salary of around 13 or 14 million euros gross per year, has to pay almost half of his salary for withholding tax. Personal income tax every year. In fact, several sources point out that Marc Márquez himself was about to leave for Andorra in 2014, but he finally backed down and maintained his residence in the capital of La Segarra, where his brother Àlex also lives.
A rather emblematic case was that of the Mallorcan Jorge Lorenzo, who after many years in Andorra left after the Government of Andorra published a request demanding tax information from the Balearic pilot. Jorge Lorenzo left the small country of the Pyrenees to settle in Lugano, Switzerland, where he also enjoys the tax advantages and banking secrecy of the Swiss Confederation.
Rubén Xaus and the Andorran banking system, the necessary hosts
The love story between the motorcyclists and the co-principality is relatively young, and starts with the story of the Barcelona Superbikes rider Rubén Xaus, a pioneer to settle in Andorra. After retiring, Xaus was able to take advantage of his contacts with the Government of Andorra and the Andorran banking system, especially with the entity Crèdit Andorrà, to create a company called Andmove Management Services, aimed at facilitating all services and advice of all kinds that a professional pilot may need in his transfer to the country of the Pyrenees.
As stated by Xaus himself in some interview: “Andorra offers first-class attractions for professional riders, such as good connections with Barcelona and Girona or the possibility of training at altitude.” However, at this point no one escapes the fact that the tax advantages offered by Andorra are a decisive factor for many pilots when deciding to take the plunge and settle in Andorra.
In Andorra, the maximum percentage of personal income tax is only 10%, although this percentage is almost never applied to the salary of motorcyclists. To this tax advantage must also be added the fact that the residents of the co-principality are also exempt from some taxes such as wealth or on profits from financial or real estate investments, which makes Andorra a real paradise for sportsmen and women. various disciplines (especially cycling, where the Catalans Melcior Mauri and Purito Rodríguez have acted as great ambassadors), youtubers and in this case also motorcyclists.
Rubén Xaus himself, host of many of the motorcyclists established in Andorra, went so far as to state that his aim was to make Andorra “the capital of motorsport in Europe ”trying to attract the attention of the best pilots to establish themselves in the co-principality. This strategy has the approval of Andorran public institutions and their financial system.
This commitment to importing elite pilots has led to the need to create infrastructures that justify, in part, the choice of Andorra as a place of residence. In fact, Crèdit Andorrà itself is one of the main investors in the Andorra Circuit in Pas de la Casa, a permanent circuit built in 1999 and thoroughly refurbished in 2017 which, located at 2,400 meters, is the highest route in the world, which offers riders the chance to improve their aerobic performance.
183 dies a l’any
It is nothing new for motorcyclists or motorists to look for a way out to avoid the Spanish tax system and, in fact, Àlex Crivillé himself, world champion in 1999, stated in an interview that “the life of riders is short ”and that it seemed“ normal ”for pilots to try to establish their residence in countries with tax advantages such as Switzerland, the United Arab Emirates and Qatar or Andorra. Crivillé even claimed that the pilots who did not change their residence were “donkeys”, although he later apologized for using the expression, which he described as unfortunate.
For some years now, the Treasury has been prosecuting the most mediated cases of tax fraud, as evidenced by the millionaire fines on various football players such as Messi and Cristiano Ronaldo. It should be noted, however, that in those cases the offenders did not comply with all their tax obligations, according to the Tax Agency, and that they had their residence fixed in Spain.
In order to be taxed outside Spain, the law stipulates that taxpayers must spend a maximum of 183 days a year within Spanish territory, a condition that many pilots are responsible for demonstrating with their photos and published stories. on fashionable social networks such as Instagram, TikTok or Twitter, although this point is difficult to prove as in a regular season MotoGP riders can be more than 200 days away from their usual residence for the same practice of motorcycling on circuits of the five continents. Interestingly, some of these motorcyclists located in Andorra take the flag of the state where they were born to celebrate sporting victories, in a gesture that some fans have described as a hypocritical point, but which is by no means a fact that affect only MotoGP riders.
It should be remembered that for just over a year the Tax Agency has changed its strategy with motorcyclists and has carried out inspections of Spanish riders who have moved their residence to Andorra or Switzerland, among others. In fact, a few months ago the ex-pilot Sete Gibernau was administratively sanctioned for having simulated his residence in the Swiss country, although the Provincial Court of Barcelona acquitted him of the crime of tax fraud. Also ex-pilot Sito Pons was even related in an international plot to the Netherlands Antilles as another derivative of the affair of the so-called Papers of Panama, which also he splashed former world champion Àlex Crivillé.
This new strategy has also meant that from this season onwards Spanish drivers will have to pay taxes on the income generated in the Grand Prix held in Spanish territory, a situation that was already applied in other countries such as France, Germany, the United Kingdom or Japan.