Mark StücklinA Financial Times analysis comparing the tax burden on property purchases across Europe finds that Spain leads the pack with the highest average tax rate — and may now top the table for its maximum rate as well.
According to the report, titled Home economics: the tax roulette of buying a house in Europe, Spain has the highest average rate of property transfer tax (ITP in Spain) among the ten countries studied. While headline rates range from 6% to 11%, the actual average comes out higher than anywhere else on the continent — meaning Spanish buyers and investors, on average, hand over more to the taxman than their European counterparts.
Spain’s regional variations push taxes higher
The FT figures list Spain’s top marginal rate at 11%, but that’s already out of date. Both the Balearic Islands and Catalonia have since introduced a 13% band for high-end properties, further cementing Spain’s position as Europe’s most expensive place to buy a home from a tax perspective.
Transfer tax (ITP) in Spain varies by autonomous community and property price, typically ranging from 6% for lower-value homes to double-digit rates on luxury property. When added to other purchase costs such as notary fees, registry costs, and legal expenses, the overall transaction burden is among the highest in Europe — well above markets such as Italy, Germany, or France.
How Spain compares
Belgium comes close behind Spain, with a 12.5% maximum rate, though several regions offer relief for first-time or principal-home buyers. The UK ranks third with a 6% average and a maximum stamp duty of 12% (rising as high as 17% for additional properties). Other countries, including Portugal, Austria, and France, maintain average rates under 5%.
At the opposite end of the scale, Zurich abolished its property transfer tax altogether back in 2005, in an effort to encourage investment — a stark contrast with Spain’s ever-heavier fiscal load.
The takeaway
Spain’s position at the top of the European tax table highlights how costly it remains in terms of transaction costs to buy property here — particularly at the upper end of the market. But even the average tax rate is high, which hurts the least well-off buyers the most.
Economists have long criticised property transfer taxes for being inefficient and counterproductive. They are widely seen as regressive, hitting lower- and middle-income buyers harder because the tax is levied upfront rather than linked to ongoing income or wealth. By penalising transactions, they discourage people from moving for work or downsizing in later life, reducing labour mobility and locking households into homes that no longer suit their needs. Transfer taxes also distort investment incentives, diverting capital away from productive activity and slowing the housing market as a whole. In short, they raise revenue, but at a high economic cost.
For buyers and investors weighing up European markets, the message is clear: in Spain, the sunshine comes at a price — and not just in euros per square metre.
