Business Environment
Local Economy
Malaga and its province have experienced economic expansion during the past few years, surpassing both the Andalusian and the Spanish growth rates.
The most dynamic sectors are Tourism, Construction, Agriculture, Technology Services and Logistics.
90 International Companies Choose Malaga for Expansion (2019-2023)
In the past five years, 90 international companies have selected Malaga as the location for their headquarters or offices, or to expand their operations. These companies are expected to create 7,000 new jobs.
Average Salary in Malaga Increases by 25% Over the Last Decade
The average salary in Malaga has grown by 25% in the past ten years. According to the latest data from the Spanish Tax Agency, in 2022 the annual average salary in Malaga was €19,443.
Technology Sector in Malaga Grows 2.2 Times in the Last Decade
According to the COTEC Foundation's Employment Map, Malaga has seen an impressive increase in its tech workforce, growing from 8,631 to 19,250 jobs. This growth rate far exceeds those of both Andalusia and Spain as a whole.
Malaga Sets New Employment Record
Ahead of summer, Malaga reached a new employment milestone with over 721,700 workers. In May, Social Security registrations rose by 11,763, while unemployment decreased by 4,198, marking the second largest drop in the country after Madrid. The province's unemployment now stands at 122,784, the lowest since 2008.
Málaga Leads New Business Creation in Andalusia
In 2023, 19,243 companies were created in Andalusia, with 36% of them based in Malaga, totaling 7,114 new businesses. Sevilla followed with 4,798 companies, representing 25% of the region's new business formations.
Malaga's Population Growth Driven by Foreign Residents
As of January 1, 2023, Malaga's population increased by 6,738, reaching a total of 586,770 inhabitants. The growth was solely due to an influx of foreign residents, now totaling 48,489—an increase of 18.8%. However, the number of EU citizens decreased by 811 to 10,629.
Malaga's economic growth (GDP) has been:
3.0% in 2023
5.0% in 2022
5.8% in 2021
2.9% in 2019
3.4 % in 2018
3.9 % in 2017
3.0 % in 2016
Taxes
Spain’s fiscal/tax year is the natural calendar year. Income taxes in Spain should be paid between May 1 and June 30 for the previous year’s income.
Tax residents will need to pay income taxes in Spain and are generally defined as those who reside in Spain over 183 days in each calendar year and/or have their main financial interest in Spain.
Personal Income Tax (IRPF) is charged on the available income of individuals according to a progressive rate scale ranging from 20% to 47%.
| Income (above allowances) | Tax Rate 2020 |
| 0 € - 12,450 € | 19 % |
| 12,450 € - 20,200 € | 24 % |
| 20,200 € - 35,200 € | 30 % |
| 35,200 € - 60,000 € | 37 % |
| 60,000 € - 130,000 € | 45 % |
| 130,000 € - 300,000 € | 47 % |
| above 300,000 € | 49 % |
Expatriate workers can choose between this general tax system or the non-resident tax system (IRNR) at a fixed rate of 24% for a maximum of 6 years and a maximum annual income of 600,000 Euros. Income generated in other countries is not subject to the tax on this Spanish income.
The following conditions must be met to be able to choose the IRNR:
- Moving to Spain must be a consequence of an employment contract
- Not having lived in Spain during the last 10 years.
- The work must be undertaken for a company that is resident in Spain or a permanent establishment of a non-resident company in Spain.