Britons face 100% property tax in Spain as PM pushes ahead with controversial new plan ()

<iframe frameborder="0" height="100%" scrolling="no" src="https://www.gbnews.com/res/scraper/embed/?video_url=https%3A%2F%2Fmm-v2.simplestream.com%2Fiframe%2Fplayer.php%3Fkey%3D3Li3Nt2Qs8Ct3Xq9Fi5Uy0Mb2Bj0Qs%26player%3DGB003%26uvid%3D52880740%26type%3Dvod%26viously_id%3DoA3ZscIMfPa" width="100%"></iframe><br/><p>Spain is pushing ahead with plans to impose a 100 per cent tax on British and other non-EU citizens purchasing holiday homes.</p><p>The bill also seeks to increase VAT on short-term rentals and raise taxes on publicly-listed real estate investment trusts.</p><h3></h3><br/><p>Prime Minister Pedro Sánchez has presented a bill to the Spanish parliament seeking to promote "measures that enable access to housing, since we are facing one of the largest problems our society is currently confronted with".</p><p>The proposed legislation follows Sánchez's January announcement of plans to tax non-EU citizens in response to surging real estate prices and housing shortages across the country.</p><p>At the time of his initial announcement, Sánchez told an economic forum in Madrid that foreign buyers had purchased thousands of properties "not to live in, but to make money from them which, in the context of the shortage that we are in, we obviously cannot allow".</p><p>The bill also seeks to increase VAT on short-term rentals and raise taxes on publicly-listed real estate investment trusts. Additionally, it proposes a levy on empty houses.</p><h3></h3><br/><img alt="Sanchez" class="rm-shortcode" data-rm-shortcode-id="78f763e83a215f68e6aa807838a3fd62" data-rm-shortcode-name="rebelmouse-image" id="55026" loading="lazy" src="https://www.gbnews.com/media-library/sanchez.jpg?id=60315171&width=569&height=394&quality=90&coordinates=0%2C0%2C455%2C358"/><h3></h3><br/><p>Similar schemes have already been implemented in Canada and New Zealand as those countries also grapple with housing affordability challenges.</p><p>Figures provided by Sánchez showed that 27,000 non-EU residents bought properties in Spain in 2023. Foreigners make up 15 per cent of the Spanish housing market overall.</p><p>UK citizens lead foreign buyers in coastal areas such as the Costa del Sol, Valencia and the Balearic Islands. The proposed tax would exempt EU citizens, including Germans and Dutch buyers who also represent a significant proportion of foreign purchasers.</p><p>The bill outlines that foreign businessmen or professional workers based in Spain would not be affected by the tax, a move which could potentially shield expat workers.</p><h3></h3><br/><div class="embed-latest"></div><h3></h3><br/><img alt="Spain coast" class="rm-shortcode" data-rm-shortcode-id="c341ff770f07258cc3b3b7b16b37e062" data-rm-shortcode-name="rebelmouse-image" id="71ddd" loading="lazy" src="https://www.gbnews.com/media-library/spain-coast.jpg?id=60315172&width=980"/><p> In Spain, individuals are classified as non-residents if they live in the country for fewer than 183 days per year.</p><p>The bill faces significant hurdles in the Spanish parliament, where Sánchez does not hold a majority.</p><p>He has been leading a minority coalition government since 2023 and requires support from approximately eight different parties to pass legislation.</p><p>This parliamentary arithmetic makes the path to approval for the controversial tax measure uncertain.</p><p><span></span>The proposed tax would apply to the closing costs when purchasing property in Spain, which include VAT at 10 per cent and transfer tax (ITP).</p><h3></h3><br/><div class="embed-dontmiss"></div><h3></h3><br/><p>Transfer tax on second-hand properties in Spain generally ranges between 6.5 per cent and 12 per cent of the purchase price and is determined at a regional level.</p><p>Iain Michael Tozer, who runs an estate agency in Barcelona, said there had already been a negative impact on buyers due to uncertainty surrounding the law.</p><p>"There has been a negative impact on some buyers, but more due to the uncertainty around it, not due to the idea of the tax itself," he explained. Tozer added that he did not believe the proposed bill would solve Spain's housing crisis.</p><p>He said: "The people that buy properties overseas are either very high-end or condominium-style properties in Costa Blanca and Costa del Sol where there's a lot of supply in property and it's not the type of property your average Spanish family is going to buy."</p><h3></h3><br/><div class="embed-mostread"></div><h3></h3><br/><img alt="Couple at laptop" class="rm-shortcode" data-rm-shortcode-id="e930ccf5f7bafa84e68166bc47f90aaf" data-rm-shortcode-name="rebelmouse-image" id="ce1db" loading="lazy" src="https://www.gbnews.com/media-library/couple-at-laptop.jpg?id=51938304&width=980"/><p>Spain's broader efforts to address housing issues include a crackdown on holiday rentals. The country's consumer rights ministry recently ordered Airbnb to remove more than 65,000 holiday homes from its platform as part of a campaign against illegal listings.</p><p>Sánchez stated earlier this year that "there are too many Airbnbs and not enough homes", vowing to prevent the "uncontrolled" expansion of holiday properties.</p><p><span></span>Local authorities have also taken action. Barcelona City Hall plans to eliminate 10,000 short-term tourist apartments by the end of 2028.</p><p>The measures come amid growing anti-tourism sentiment. In Tenerife, organisers claimed 100,000 demonstrators participated in a protest against tourism in the capital city.</p>