Santa Cruz de Tenerife, the island’s capital, lies in the heart of Tenerife and pulses with modern energy. It is a dynamic city that moves forward, aiming to be one of the top places to live, explore, visit, and start a business in Spain.
Tenerife’s capital is a hub for commerce, dining, entertainment, communications, and tourism. It hosts numerous Spanish companies and offers strong incentives that make it stand out among the best cities to invest in Spain. The Santa Cruz de Tenerife City Council launched these tax incentives as a tool to revive the municipal economy.
Tenerife’s capital, Santa Cruz, has become a benchmark for business opportunities and a reference for gastronomy, hospitality, and services. Tax incentives help set it apart as a prime investment location in Spain. The incentives contribute to Santa Cruz being recognized for its favorable fiscal environment.
Thanks to these measures, Santa Cruz de Tenerife ranks second in Spain in the 2022 Index of Economic Freedom of Spanish Cities by Foundation Avance de la Libertad. Other assessments also highlight the city’s advantages. The Madrid Tax Rating Studies service has certified Santa Cruz as the state capital with notably low taxation.
The IBI levy in Santa Cruz de Tenerife sits at a mid to low level, alongside other taxes such as the Economic Activities Tax and the Building, Facilities, and Works Tax. The city also offers one of the lowest roaming taxes in Spain and, for SMEs and the self-employed, a reduction in waste collection rates. What does this mean for investors in Santa Cruz? About 12,000 self-employed residents benefit from exemptions on municipal taxes, and around 90,000 families have received subsidies, with expectations to continue into 2023. The startup fee in Santa Cruz de Tenerife is also favorable.
These measures, introduced by the City Hall, reflect a municipal tax savings totaling 11.2 million euros for families and small businesses over the past two years. It’s a standout advantage within the Canary Islands and one of the strongest in the broader region.
Besides tax advantages, Santa Cruz de Tenerife draws millions of tourists each year. The city holds 51 tourism services with the SICTED quality mark, along with a robust supply of accommodations, major museums, and other attractions. A collaborative effort by the Development Association, tourism-sector agencies, organizations, companies, and local professionals helped reach 1.7 million visitors in 2022, surpassing 2021 and approaching pre-pandemic figures. In December alone, 124,596 cruise passengers arrived, with seven out of ten visiting the city, marking a 14.6% rise over pre-pandemic levels. By 2023, 313 cruise ships were already planned to dock at the Port of Santa Cruz de Tenerife.
To sustain growth and push for a qualitative leap, the City Hall announced plans to inject around 44 million euros into the capital’s tourism sector over the next six years. The investment supports revitalizing public spaces, promoting the city’s tourism sector, and driving broader revitalization efforts across the capital.
As part of the Tourism Strategic Plan, Tenerife Santa Cruz will allocate 5 million from Next Generation funds to transform the coastline over three years. Projects include the northwest breakwater at Las Teresitas and an expanded bike path. The city will also advance mobility improvements with an investment of 895,000 euros to upgrade tourist offices and bolster the Santa Cruz Carnival as a major local attraction. These initiatives add value to the municipality and its visitor experience.
Budget plans include 195,000 euros for improving and expanding Paseo de Carteles del Carnaval and creating a self-guided tour route for the Santa Cruz Carnival. Upgrades to signage and product development, plus broader tourism promotion, are expected to deliver more than one million euros in economic support.
A tourism shock plan will see hotels in Santa Cruz de Tenerife benefit from more than 350,000 euros dedicated to marketing and destination branding, along with product development and the restoration of historical heritage.
What to do in Santa Cruz de Tenerife?
With a budget exceeding 30 million euros, the city undertook its largest historical-heritage investment program to date. The goal is to preserve iconic buildings and enrich the range of experiences available to visitors, combining history, culture, heritage, and tradition in Santa Cruz.
Discover Santa Cruz de Tenerife — Heart of Tenerife
The cultural calendar in Santa Cruz de Tenerife continues to grow, including the Masonic Temple, a unique building once intended to house a cottage in Spain and now a landmark for Freemasonry studies in Europe. About 3 million euros will be invested in 2025 to develop the Masonic Temple as a center for study and dissemination.
Other major projects include rehabilitating the BIC property, Viera y Clavijo Cultural Park, with more than 12 million euros aimed at returning historical, cultural, emotional, and natural heritage to the citizens. The Palacio de Carta will become the city’s main tourist office in the near future, with over one million euros allocated for restoration.
The City Council approved the rehabilitation of the former School of Applied Arts and the Ireneo González square, a building classified as an Asset of Cultural Interest. The plan envisions improvements over more than 4,800 square meters of built space with an investment surpassing 7.6 million euros. Other investments include the Palacio de Carta, plus environmental improvements around San Andres Castle with a budget close to one million euros.
On the employment front, the capital has shown positive momentum since the pandemic. Unemployment has declined, and job creation has surged. In December 2022, unemployment stood at 20,206, a drop from 21,580 in 2019, putting it near 2009 levels. At the same time, hiring activity surged, with 119,530 jobs in local companies — the peak in the historical series since 2010.
Overall, Santa Cruz de Tenerife presents a compelling case for living, investing, and visiting. The combination of favorable tax regimes, a growing economy, a thriving tourism sector, and ongoing cultural and infrastructural investments makes it a city with a bright outlook for the future.