On Monday, Balearic government spokesperson Iago Negueruela defended the increase in tax on documentation for the purchase of properties valued at one million euros and more. "If someone can buy a home for that price, they also have money to pay the corresponding taxes."
The minister didn't believe that this measure will discourage purchases, while he added that there is to be a tax reduction in respect of homes valued at under 270,000 euros.
The ABINI association of national and international real estate agencies, which has been the harshest critic of the government, in particular its talk of a residency qualification for buying properties, says that the tax on paperwork will not only affect wealthy foreign buyers. The association points to the Balearics having the highest property taxes in Spain and believes that the government is "engaged in a battle" against purchases by non-residents.
The association maintains that tax increases in the Balearics, combined with new taxes from the national government, are leading to "a worrying number of people" withdrawing from the Balearic market - a number that will not be recovered. As to the tax reduction for properties under 270,000 euros, the ABINI insists that this is an "insufficient" measure because there are few homes for that price.
"The property sector and the public are being kidnapped by a system that has not known how to put housing at the service of residents, which has generated the highest fiscal dependence on housing taxes in public accounts ever known, and has done nothing to modernise an anachronistic housing system that is a burden for all residents of the islands. Instead of generating more income, all these increases will achieve the opposite."
4 comments
To be able to write a comment, you have to be registered and logged in
Ulla JacksonAccording to Idealista there are 4,903 properties for sale under 280.000€. The filter didn't allow me to put the figure of 270.000€
The cost of buying a property in Mallorca is expensive, to sell is extorsionate, and the Capital Gains Tax unfair compared to other locations with no indexation allowances applicable. An absolute rip off.. My Advice is DON'T BUY PROPERTY IN MALLORCA. Thankfully I've managed to put off 2 potential buyers and I will keep up the good work.
Where in Majorca will you find a property at 270 000 or less? That would be difficult if not impossible. That's why they set that amount knowing they still will rake in loads of tax money, I believe. Don't like the non residents but do like their money.
The only concern if the ABINI is that they would not make as much money by selling so many luxury properties to foreigners