New property tax for non residents.

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Spanish Prime Minister, Pedro Sanchez, was forced to defend his controversial new property tax on home sales to non-resident/non-European Union buyers at the World Economic Forum in Davos this week. The tax will principally hit British and American property buyers in Spain as they are some of the biggest buyers of Spanish property but obviously from outside the European Union and in some cases non residents in Spain.

Sanchez said that at a time when Spain was struggling with a lack of housing it was incredible that non-resident/non-EU citizens could own a home bought in most cases as an investment which they hardly used. When questioned he denied that Spain was anti-foreign investment.

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The proposed tax, which many informed sources believe will never be approved by parliament, places a 100 percent surcharge on non-European Union buyers. For the British it could mean the end of a dream of a Spanish holiday homes.

The Spanish government says that 27,000 properties across the country where sold to non-resident/non European Union citizens.

Property experts say that the biggest losers from this proposed tax will be the British because they are still the Number 1 market for Spanish property. The opposition Partido Popular has said that they will not allow the tax in the Spanish regions where they govern which includes the Balearics.