Home News Spain in tax-breakplan for rental homes

Spain in tax-breakplan for rental homes

Published on 27/05/2004

27 May 2004

MADRID – The Spanish government could offer tax breaks for rental homes in an effort to solve the shortage of affordable housing, the Housing Minister said Thursday.

María Antonia Trujillo said Spain was the only European country where there were no tax breaks for those who rent, while the tax advantages for home buyers were the highest in the EU.

She told the Spanish parliament the government might reform tax laws to make tax advantages fairer for those who rent homes as well as those who buy.

Trujillo said the government was not going to eliminate tax deductions for home owners but bring in similar advantages for tenants.

This will not be a retrospective reform, so those who have bought homes already will not be affected.

She said the government’s plan was part of an overall ‘plan of attack’ to give Spaniards access to 180,000 homes  – 90,000 new and the others used – each year.

She said it could offer incentives for homes to be built to rent and for empty housing, owned by individuals, to used as rental stock.

Spain has a high number of empty properties that are owned by families and left unoccupied until they are handed from one generation to another.

Trujillo said tenants will be offered help to pay their rent as well as offering new guarantees to property owners to ensure they would get their rent.

The government is considering reducing VAT to 4 percent for homes that are considered ‘social’. It is currently 7 percent.

Trujillo said the government was also thinking of raising the maximum price of house sales, especially in cities, to promote developers.

This only applies to ‘social housing’, which has a price limit because it is intended for poorer people.

Offering affordable homes was one of the cornerstones of the Socialists’ electoral promises.

They claimed they could help many Spaniards who cannot afford to buy their own homes in the housing boom.

[Copyright EFE with Expatica]

Subject: Spanish news