In brief
Spain is set to implement an unprecedented tax of up to 100% on properties purchased by non-EU residents, including individuals from the UK. Prime Minister Pedro Sánchez characterized this move as necessary to combat the country's housing crisis and prevent a deep socioeconomic divide. This announcement came during an economic forum in Madrid, where Sánchez highlighted that non-EU residents acquired 27,000 properties in 2023 not for personal residence, but primarily for profit.
To prioritize housing availability for residents, Sánchez stated, "We obviously cannot allow" such purchases amid a housing shortage. While specifics of the tax implementation remain vague, the government draws comparisons to similar measures in Denmark and Canada, emphasizing its goal of limiting foreign investment in housing. The proposal is part of a broader set of initiatives to enhance housing affordability, including tax exemptions for landlords who provide affordable housing, the establishment of a public housing entity to manage over 3,000 homes, and increased regulations on tourist rentals. Sánchez criticized the current tax disparity between short-term rental landlords and hotels, asserting that it is unfair for property owners with multiple rental units to pay less tax. The specifics of the new tax and timeline for parliamentary approval will be discussed after further study.
