Spain is expected to launch its 'digital nomad visa' in January. Here's what we know about the program so far.

• Spain's parliament recently approved a "digital nomad visa" for foreign remote workers. 
• The visa is part of Spain's new Startups Act and is expected to pass in January 2023. 
• The minimum income requirement will likely be between €2,000 and €3,000 a month, local outlets report. 

Spain has been teasing a "digital nomad" visa for over a year now that would allow remote workers to live and work in the country for up to five years. 

The visa, bundled within a new startup law aiming to help the country's burgeoning tech scene, was approved by the Spanish parliament in early November. Now, the bill just needs final ratification by the Senate before going into effect.

The highly-anticipated visa is expected to officially launch in January 2023, according to local media reports. Here's everything we know about the program so far, and how it stacks up to Portugal's popular counterpart. 

Digital nomads would pay a reduced income tax of 15%

Under the Startup Act, visa recipients who make less than €600,000 a year would qualify for a reduced non-resident income tax of 15% for up to four years. Typically, non-residents must pay a personal income tax of 24%. 

The visa and its favorable tax structure are only open to remote workers who receive at least 80% of their income from companies located outside of Spain. Recipients can renew the one-year visa every year for up to five years, after which they can apply for permanent residency. 

Experts predict an income requirement of around €2,000 a month

Spain has not said what minimum monthly income remote workers must make in order to qualify for the visa. However, some experts have predicted the threshold will be around €2,000 (approximately $2,069) a month, according to local media reports. 

Spain's income requirement will likely be two times the national minimum wage in Spain (currently €1,050), which would mean digital nomads would have to make at least €2,100 in order to apply, Behar Sadiku, a spokesperson for VisaGuide, an immigration planning service told Insider. 

That's slightly less than Portugal's digital nomad visa, which requires remote workers to make at least four times its minimum wage to apply. Portugal is scheduled to raise its monthly minimum wage to €760 in January, which would bring the visa's income requirement to €3,040 a month. 

Portugal and Spain are competing 'in a good way' over talent 

With its favorable climate and proximity to major European hubs, it's no wonder why the Iberian peninsula is becoming a digital nomad hotspot. 

Before Portugal launched its digital nomad visa at the end of October, remote workers flocked to the country through its D7 visa, also known as a passive income visa. Now, Spain wants in on the action. 

Unlike similar immigration schemes outside of Europe, both of the countries' digital nomad visas would allow recipients to travel visa-free throughout the Schengen Area, a region containing 26 European Union member countries where travelers can move freely without dealing with border control. 

Radim Rezek, CEO and co-founder of Flatio, a short-term housing platform popular among digital nomads in Europe, told Insider that Portugal is "much more developed" in terms of attracting remote workers and tech entrepreneurs to its shores, something that Spain has sought to imitate.

"There is a little tension between them, so they kind of compete — but in a good way of course," he said. 

Some local workers fear the digital nomad wave will raise the already high cost of living

While proponents of digital-nomad visas say the programs can boost local economies, some critics worry that the influx of foreign remote workers will raise housing prices in areas that are already struggling with inflation. 

From Mexico City and Puerto Rico to Barcelona, many local workers have voiced concern that the influx of international remote workers since the pandemic has done more harm than good. 

Spain's Startup Act and digital nomad visa have so far seen support from both sides of the political spectrum. Nadia Calviño, the country's economic affairs minister, called the bill's approval "one of the most enjoyable moments I've experienced in the Parliament." 

"It's a law that will allow Spain to be at the forefront in the push and promotion of talent in this rapidly growing digital economy," she added.