The Government of Catalonia and the Comuns party have approved a series of fiscal reforms aimed at regulating the real estate market and ensuring housing accessibility. Below are the key changes and their implications:
1. Reform of the property transfer tax (ITP):
New tax brackets:
- Up to €600,000: remains at 10%.
- €600,000 – €900,000: 11%.
- €900,000 – €1,500,000: 12%.
- Over €1,500,000: 13%.
20% Rate for large property holders
Who is a large holder?
- Owners of 5 or more residential properties in high-demand areas(e.g., Barcelona).
- Owners of 10 or more properties in other areas.
Application: applies to transactions involving entire buildings (with or without subdivisions).
Exceptions:private buyers purchasing buildings with fewer than 5 units for use as their primary residence for at least 3 years.
Objective: to deter speculative property accumulation.
2. Elimination of tax breaks for real estate companies
Measure: removal of tax incentives for real estate firms in property transactions.
Social Compensations:
- Victims of gender-based violence: reduced ITP rate of 5%for primary residence purchases.
- Income Tax (IRPF) Deduction: applicable to rental expenses for primary residences, effective January 2025.
3. Increase in tourist tax
In Barcelona:
- 5 stars hotels: from €3.50 to €7 per night (up to €15 with municipal surcharge).
- Tourist Rentals: from €2.25 to €4.50.
- Cruises (<24h): From €3 to €6.
Outside Barcelona:
- Hotels: from €3 to €6.
- Municipalities: authorized to apply additional surcharges of up to €4.
Fund Allocation: 25% of revenue will fund affordable housing initiatives.
Industry perspective: experts warn of potential declines in investment appeal, particularly in urban areas with existing regulations.
5. Legislative process
The reforms will be formalized via a decree law, pending approval by the Catalan Parliament. Once published in the Official Gazette of Catalonia (DOGC), the changes will take immediate effect.
Recommendations:
- Property owners and Investors: consult tax advisors to assess the impact on current or future portfolios.
- General public: stay informed through official channels during the regulatory.
