Shakira wins €55mn tax battle against Spain

Shakira has scored a big win in a protracted battle against Spanish tax authorities who were ordered to return €55mn in unlawful penalties that the Colombian pop star had been forced to pay.Spain’s National High Court on Monday annulled a decision by the tax agency in a case about whether Shakira was a tax resident in the country in 2011, saying it had failed to prove its claims and levied sanctions that were “contrary to the law”.The singer-songwriter, who was in a relationship with Barcelona football star Gerard Piqué at the time, criticised the authorities’ “questionable methods” and said the case had morphed into “orchestrated campaigns to destroy my reputation”.The court said Spain’s tax agency had failed to prove that Shakira spent more than 183 days in the country in 2011 — the threshold for becoming a tax resident — nor that she had “the centre of her economic interests in Spain or family ties with residents in the country”.Shakira’s team argued it was “materially impossible” for her to have spent more than half the year in Spain because she “was on a world tour, performing 120 concerts in 37 different countries” in 2011.“She had no home in Spain, no children there, and never had her business headquarters in the country,” the statement said. Shakira and Piqué had two children born in 2013 and 2015. They announced their separation in 2022.The court said Spain’s tax agency must pay interest to Shakira in addition to the €55mn in penalties.The agency said it would appeal against the court ruling in Spain’s supreme court.The agency also noted that Monday’s judgment did not affect a settlement Shakira reached with the authorities over the 2012-14 tax years, when she also claimed she was not a Spanish tax resident.In a plea deal struck in November 2023, Shakira admitted six counts of tax fraud relating to 2012-14 and agreed to pay a fine of €7.3mn to avoid imprisonment. At the time Shakira insisted she had done nothing wrong but said she reached the agreement to protect her children and move on with her career.On Monday Shakira’s team called the court ruling on 2011 a “definitive victory”.Shakira said: “After more than eight years enduring brutal public targeting, orchestrated campaigns to destroy my reputation, and sleepless nights that ultimately affected my health and the wellbeing of my family, the [court] has finally set the record straight. There was never any fraud.“Even so, for almost a decade I was treated as guilty. Every step of the process was leaked, distorted and amplified, and my name and public profile were used to send a threatening message to other taxpayers.”The National High Court also criticised the tax agency for focusing on the tax advantages of the Bahamas, where Shakira claimed that she was a tax resident in 2011. “Whether or not the Bahamas was a tax haven in 2011 is irrelevant, because the appellant has proved that she remained outside Spain for at least 183 days,” the court said.