The foral regime is the system under which the historical territories of the Basque Country (Bizkaia, Gipuzkoa and Álava) and Navarra maintain, regulate and collect their own taxes by virtue of historical rights recognised in the Spanish Constitution. In the Basque Country it operates through the Economic Agreement (Law 12/2002) and in Navarra through the Economic Convention. In practice, the personal income tax, corporation tax, wealth tax and inheritance tax of their residents are governed by their own legislation, with scales, deductions and special regimes different from the state ones.
In practice
What the foral regime is
The foral regime is the most important territorial exception in the Spanish tax system: the three Basque historical territories and Navarra retain the power to regulate, manage, assess and collect their own taxes. It is not an administrative delegation but a historical right protected by the first additional provision of the Constitution, implemented through the Economic Agreement with the Basque Country (Law 12/2002) and the Economic Convention with Navarra.
The practical consequence for the taxpayer is direct: residence determines the entire system. A resident of Bizkaia does not apply the state LIRPF but Norma Foral 13/2013, with its own scale (23% to 49% in 2026), its own deductions and its own special regimes.
Why it matters to impatriates
Talent-attraction regimes are the clearest example of divergence: the state Beckham Law does not exist in foral territory, and its place is taken by the displaced workers regime of article 56 bis (30% salary exemption, relocation expenses deductible up to 20% and up to eleven tax years of duration). The differences in tax between destinations are substantial and deserve arithmetic before the move.
The connection points
The split between treasuries is resolved through the so-called connection points: habitual residence for individuals, tax domicile and turnover for companies. Conflicts between administrations are settled by the arbitration boards of the Agreement and the Convention.