Insights

Spain’s New Housing Tax Measures: Balancing Policy Goals with Legal and Investment Risks

Gonzalo Rincon De Pablo 13 Jun 2025

An analysis by Garrigues, Taxand Spain

Spain is set to introduce a range of new housing-related tax measures at both regional and national levels, aimed at curbing speculation, promoting affordable housing, and redistributing the tax burden. In Catalonia, recent reforms include higher property transfer taxes for high-value transactions and large holders, with a top marginal rate of 20%. These measures are targeted, not general, and aim to deter speculative investment, though they raise potential constitutional concerns and could shift investment to other regions.

At the national level, a proposed Complementary State Tax would impose a 100% levy on property purchases by non-EU residents, raising serious legal doubts under both EU law and Spain’s constitution. The bill also proposes:

• A progressive imputation of rental income up to 3% of cadastral value to discourage vacant properties;
• A complex system of rental tax reliefs based on multiple factors, which may create confusion and reduce practical effectiveness.
• 21% VAT on tourist rentals in towns over 10,000 people, potentially altering the balance with hotels while allowing VAT deductibility.
• An increase in tax on undistributed REIT profits from 15% to 25%, with reductions for affordable housing commitments.

Gonzalo Rincón from our Spanish firm Garrigues has published a detailed analysis of these measures which can be read here, arguing that while aiming to address social and economic housing pressures, the proposed reforms could reduce Spain’s attractiveness to property investors, increase legal uncertainty, and trigger constitutional challenges.

Article tags

Compliance | Investments | Real Estate Tax | Spain | Tax | Tax Reform | VAT