Re: Re: VAT 10 % on new propertys?


Fuengi (Andrew)

Hi, just to comment on a few points.

First, taxes. No wealthy foreigners are being targeted, nor are owners of second homes in Spain. What is happening now is fiscal residents are coming under more scrutiny. Considering the amount of people that bemoan the black economy, the lax enforcement of rules along the med, etc… should be happy, no?
Your are a tax resident if you spend over half of the year in Spain. Some have mentioned 3 month periods though?

Second, 10% IVA. The government has raised tax on a range of goods, they do not see newly built properties as any different. This does not affect re-sales. Interestingly, looking at the level a newly built property sales during the reduced tax period, demand has not been that elastic in regards to the lower cost of buying.

In regards to the economy, this will affect the primary, secondary and tertiary industries involved in property. But then again, spain was far to dependent on this industry. Also, in the long term it offers little real economic benefit, being reliant on low skilled workers, destroying land for resources and paving more land under concrete. I think they hope to move a ‘reduced’ industry towards being more sustainable in their projects (revitalization,renovations,etc…).