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Spain plans 100% tax on ‘foreigner’ holiday homes

Spanish Prime Minister Pedro Sánchez is to impose a tax of up to 100% on the value of properties bought by non-residents from countries outside the EU, such as Britain.

Announcing the move, Sánchez said that the "unprecedented" measure was necessary to meet his country's housing emergency.

'Rich landlords and poor tenants'

"The West faces a decisive challenge: To not become a society divided into two classes – the rich landlords and poor tenants," he said.

Non-EU residents bought 27,000 properties in Spain in 2023, Sanchez told an economic forum in Madrid, "not to live in" but "to make money from them".

"Which, in the context of shortage that we are in, [we] obviously cannot allow," he added.

The move was designed to prioritise available homes for residents, the Spanish prime minister said.

His office described the proposed measure as a way to limit the purchase of homes by "non-resident non-EU foreigners".

"The tax burden that they will have to pay in case of purchase will be increased up to 100% of the value of the property, in line with countries such as Denmark and Canada," it added.

The Spanish government said that the proposal would be finalised "after careful study".

Affordability

It is one of a dozen planned measures announced by the Spanish prime minister yesterday (13 January) aimed at improving housing affordability.

Other measures announced include a tax exemption for landlords who provide affordable housing, transferring more than 3,000 homes to a new public housing body, and tighter regulation and higher taxes on tourist flats.

"It isn't fair that those who have three, four, or five apartments as short-term rentals pay less tax than hotels," the BBC reported Sánchez as saying.