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Anti-rumor - They don't pay taxes

Data and arguments for dispelling rumours and stereotypes about cultural diversity and business

Whoever says:

"They don't pay taxes and get social benefits".

Might not know that:

  • There are no specific benefits or tax bonuses for businesses run by immigrants. Immigrant businesses have the same tax and labour obligations as native businesses, and failure to comply is pursued and sanctioned equally.
  • Immigrant shopkeepers need to provide evidence of compliance with their tax and Social Security obligations in order to renew their work permits.
  • It's not true that immigrant shopkeepers can open their businesses more easily. The so-called express license, that speeds up the process of starting and carrying out a business activity, is applicable to any business with a sales surface under 2,500 square metres.

Whoever says:

"Immigrant business as unfair competition".

Might not know that:

  • Opening of shops run by foreigners has revitalised areas of the city that were becoming increasingly depressed in terms of population and business. So immigrant shopkeepers have provided a generational renewal in businesses that had closed down upon retirement of owners.
  • In the province of Barcelona, the percentage of people in the 18 to 65 age bracket is higher than 17%, but only represents 9.26% of self-employed workers in the business sector.
  • Opening new business in an area isn't necessarily unfair competition for nearby businesses, because greater commercial concentration is, in itself, a way of attracting buyers from the entire city. More active establishments entail greater commercial continuity (less closed shops), more light and people on the streets (with a stronger sense of safety), a greater variety of supplies available to buyers or more care for the area and cleaner streets. "It's always better to have an open shop next door than a closed shop. If shop windows aren't lit there is no commercial attraction and that deteriorates the streets, with all the safety problems that involves."
  • Immigrant shopkeepers have helped in recovering commercial formats and types of shops that had begun to disappear, like the small food shops that provided an alternative to the large shopping centres, thus bringing these products into the neighbourhoods.
  • More than half of Barcelona residents choose neighbourhood or specialised shops to buy a variety of products, to the detriment of shopping centres and department stores. This fact is encouraged by the increase in small local businesses in close proximity, often run by foreigners. So immigrant shops are not competition; rather they help in fighting the competition from large shopping centres located on the outskirts of the city that entail lesser purchases for all local shops.
  • There are generally few establishments run by foreigners that only cater to immigrant customers. Seventy-five percent attend both foreigners and natives. This goes to show that shops run by immigrants don't become shops for foreigners, rather for people in general living in the neighbourhoods, thus boosting the area's commercial landscape.

Whoever says:

"They don't comply with regulations".

Might not know that:

  • Rumours about failure to comply with shopping hours are often widespread because people are not aware of current regulations. Shops run by immigrants don't open whenever they want. They must do so, like all other retail stores, according to trading regulations. All shops can open on workdays between 7 a.m. and 10 p.m. Shops are free to determine their own schedules as long as they keep within this time range. Therefore, it is not that retail shops run by immigrants open longer than they should; it is rather that they open for as long as the law allows all shops to operate.
  • However, regulations also include a few exceptions: particularly in Catalonia, small food stores with a sales surface of less than 150 square metres owned by a small or medium business are free to keep their own shopping hours (and can therefore open on Sundays and holidays, if they so wish).
  • Hairdressers, beauty parlours, laundromats or call shops can open on holidays since they are establishments that provide services and are therefore not subject to shopping schedule restrictions.
  • To enforce regulations, Barcelona City Council is responsible for periodic random inspection in the city, both by areas or districts, or by types of establishments. In this sense, retail stores are all equally subject to inspection, regardless of the owner's nationality.
  • For the most part, it is immigrant shopkeepers who suffer the most from irregular practices carried out by other shopkeepers, because they are all claimed to manage their businesses inappropriately when only a few fail to comply with regulations.
  • A number of organisations are responsible for visiting city storekeepers to provide information about regulations and their compliance, the main reason being that failure to comply is occasionally due to lack of awareness and not to intentional malpractice.

Whoever says:

"Immigrant businesses associate with mafias for funding or to remain competitive".

Might not know that:

  • Immigrant small business is commonly a family endeavour. In some cases, setting up a business of their own is a goal that couples pursue with all their savings for many years; in others, funding is provided through "solidarity loans" granted within the family network.
  • Depending on the preferred business model, shops run by immigrants can compete by offering low prices. This is achieved by pooling together with others to place large orders and negotiate better conditions for bulk purchasing. In many cases too, humble shops avoid heavy maintenance expenses which in turn would be passed on to final prices of products.
  • The low profit margin immigrant shopkeepers are willing to accept and the use of funding alternatives within the family often lead native shopkeepers to view them with mistrust.

Whoever says:

"They don't join business associations".

Might not know that:

  • It's true businesses run by immigrants join business associations to a lesser degree; however, it's not so much because of a lack of interest but rather due to mistrust and lack of information. Proof of this is the fact that all business mediation initiatives have been successful in integrating immigrant small business entrepreneurs within the commercial networks of the neighbourhood.
  • The number of immigrant shopkeepers in associations is still moderate, but is gradually increasing.
  • Initiatives are underway by organisations like PIMEC-Comerç, the Business Confederation of Catalonia and Neighbourhood Business Associations that have succeeded in getting immigrant shopkeepers to join their networks.
  • In 2007, businesses run by the Chinese community joined PIMEC-Comerç. For the first time in Spain, an association of entrepreneurs of ethnic origin engaged in a national business platform.
  • In the neighbourhood of El Raval, the immigrant population is present in the 10 business associations and in 2 working groups active in the area.
  • Estimates are that about 65% of immigrant storekeepers are not aware that this type of organisation exists. On the other hand, some of those who are aware view them with mistrust partly because of the lack of information about the functions they play and the services they can provide to partners. It's also good to remember that many of these people come from countries with very different organisational cultures or that lack this type of organisations, or where they essentially play a controlling or sanctioning role.
  • Professionals working daily in this sector attest to the fact that shopkeepers have similar concerns regardless of their nationality: clean streets, regulatory compliance, public safety, drops in consumer purchasing...
  • Promoting participation in business associations is a pending goal, not only among immigrant shop owners but with the rest of businesses as well. Less than half (47%) of Spanish shopkeepers are members of these organisations. So, organisations of this kind must make a great effort to promote themselves and get businesspeople to understand the need to join associations as a way to strengthen and make improvements in the sector.