Tax

Luxury home sales raise more tax revenue than the ecotax

Luxury properties of one million euros of more brought in 118 million euros tax.

Majorca Daily Bulletin reporterPalma07/06/2017 00:00

The sale of luxury homes is good business for owners, estate agents and also the regional government. In 2016, the government received 20.2 million euros in taxes from the sale of only 33 super-luxury properties. Ten of these had a value greater than six million euros, while the other 23 sold for between four and six million.

In addition to these, there were 152 homes that were sold for between two and four million euros. The result of these 185 sales was that the amount of tax that the government obtained was higher than it envisages receiving from the tourist tax this year: around 60 million euros. When properties that were valued at between one and two million euros are added to the equation, the total income for the government was 118 million.

The tax on property sales and transfer is eight per cent for properties worth up to 400,000 euros. It rises to 10.76% of the property's value in the case of the super-luxury homes.

In 2016, there were in all 22,672 sales of secondhand properties in the Balearics, the vast majority of them (just over 18,000) having been worth up to 400,000 euros. The total tax raised on all these was just under 365 million euros. But when one considers the value of the business, i.e. what they were sold for, the amount (4,222 million) was practically the same as the regional government's budget for 2017.