Spain deflects tax treaty with Gibraltar

GIBRALTAR, May 4 (UPI) -- A treaty ending Gibraltar's status as a tax haven for Spaniards requires a British signature, a Spanish Foreign Ministry spokesman said.

The Times of London quoted an unnamed government spokesman, who said, "We are working to reinforce the cooperation on fiscal issues but at the same time defending our position in international law."

The problem: Spain does not recognize Gibraltar, a British colony since 1704, as an independent sovereign state.

"The text is agreed and as far as we are concerned could be signed tomorrow," Gibraltar Chief Minister Peter Caruana said. "We don't want to be seen as a threat to Spain's public treasury."

Gibraltar has signed similar agreements with the United States, France and Germany, The Times reported.

The tax agreement was established in principle with Spain, Gibraltar and Britain in July. Spain and Gibraltar are negotiating last-minute details, The Times said.