Spain plans 100% tax for homes bought by non-EU residents
Spain plans to tax goods up to 100% on value Property purchased by a non-resident from a country outside the EU, such as the UK.
Announcing the move, Prime Minister Pedro Sanchez said the “unprecedented” measure was necessary to address the country’s housing emergency.
“The West faces a decisive challenge: not to become a society divided into two classes, rich landowners and poor tenant farmers,” he said.
He told an economic forum in Madrid that non-EU residents bought 27,000 properties in Spain in 2023 “not to live in it” but “to make money from it”.
“In the context of the shortages we are in, (we) clearly cannot allow this to happen,” he added.
The Spanish Prime Minister said the move was aimed at prioritizing available housing for residents.
Sánchez did not provide more details on how the tax would work or a timetable for bringing it to Congress, where he often struggles to gather enough votes to pass legislation.
His office described the proposed measures as a way to restrict the purchase of homes by “non-resident non-EU foreigners”.
It added: “The tax they have to pay on purchase will increase to 100% of the property’s value, in line with countries such as Denmark and Canada.”
The Spanish government said the proposal would be finalized “after careful study”.
Potential British buyers told BBC News the offer made them reconsider buying in Spain.
Michele Hayes, from Manchester, was house hunting in south Alicante for the weekend and wanted a property for her family to visit and spend time in during their retirement.
“We could consider buying quickly before the taxes kick in, but we don’t know what’s going to happen in the future,” she said.
“If we can no longer sell properties to non-residents, especially holiday homes in tourist areas, then sales may be difficult.”
The 59-year-old said she sympathized with their housing problems but said she wanted to boost the local economy, asking: “How many Spanish workers want to live in holiday homes in these tourist areas anyway? “
Martin Craven, from London, said he had been considering buying property in Spain this year.
The 62-year-old said: “I would never have considered going in before this tax because who knows what else they could do, retroactively tax or tax existing owners.”
“I now turn my attention to Cyprus.”
Julian Hunt, 54, from Surrey, said Spain was his first choice for buying a holiday home but now it “looks riskier than other countries”.
“I hope to be there for four to six months a year while traveling, spending money, buying food and drink, paying taxes,” the 54-year-old said.
“In the UK we also have problems with landlords buying up multiple properties and pushing up the rest, but this policy is ignoring those of us who want to spend our money at home.”
It is one of more than a dozen planned measures announced by Spain’s prime minister on Monday to improve housing affordability in the country.
Other measures announced include tax exemptions for landlords providing affordable housing, the transfer of more than 3,000 homes to new public housing agencies, and tighter regulations and higher taxes on tourist apartments.
“It’s unfair that people who own three, four or five apartments as short-term rentals pay less in taxes than a hotel,” Sanchez said.
