SPAIN: Spanish Prime Minister Proposes 100% Tax For Non-EU Buyers

Spanish Prime Minister Pedro Sánchez has proposed taxes of up to 100% for non-resident non-EU purchasers of property in Spain, as one of several measures intended to address the housing crisis.

Sánchez launched his proposals as part of a New Year push to prioritise housing, under the slogan “More homes, better regulation and more assistance”.

“For non-resident foreign buyers taxes will be up to 100% of the value of the property,” Sánchez told an economic forum in Madrid, stating that foreign buyers bought 27,000 properties in Spain in 2023, “not to live in” but “to speculate and make money from them”.

“In the context of the shortage that we are in, this obviously cannot be allowed,” he added.

Any such measure would affect future British buyers, who continue to form the most important foreign market for Spanish property, despite a gradually decreasing presence since Brexit. In terms of non-EU buyers in Spain, the British are far ahead of other markets such as Morocco, Russia, China and India.

Other measures proposed by Sánchez include an exemption from personal income tax for landlords who rent out properties according to the newly published Price Reference Index; further incentives for those who offer private rentals and the transfer of thousands of properties to the new Public Housing Company.

Tighter regulations and higher taxes on holiday rental properties were also among his proposals.

Sánchez has not proposed a timescale for new legislation, and many of his proposals are likely to face strong opposition in Spain’s parliament, where he holds a fragile minority. In fact, some experts believe that his announcement was intended to cool the market rather than result in law.