Spain’s opposition proposes ‘zero’ property tax for first-time rural buyers
In the midst of an election campaign sparked by housing protests, Spain’s possible next Prime Minister, conservative PP leader Alberto Núñez Feijóo, has pledged serious tax incentives to people buying their first home in rural areas of the country.
The leader of Spain’s centre-right Partido Popular (PP), Alberto Núñez Feijóo, has proposed a tax cut for rural areas and floated the idea of a “zero tax” scheme on the purchase of homes as primary residences in rural areas.
This comes as Spain is in the midst of a general election campaign largely centred on housing, with the poll scheduled for November 29th.
The Local has already looked at what a possible Partido Popular (PP) and Vox coalition could mean for foreigners in Spain, as well as more specifically on how the two right-wing parties claim they’ll fix the country’s housing crisis.
Now Feijóo has outlined his vision for rural Spain. The PP President, and according to polls likely next Prime Minister of Spain, stated that rural areas “bear an excessive tax burden” and pledged a “total exemption” from property transfer tax (ITP) and stamp duty (AJD) on the first property purchase for people under the age of 40.
Property transfer tax on used homes ranges between 6 and 11 percent of the value of the property (depending on the region), whereas people buying new builds pay VAT and AJD stamp duty instead, the latter generally being between 0.5 percent and 1.5 percent on the value of the transaction or mortgage liability.
If the PP were to come to power and their proposed measure were to come to fruition, it would result in considerable savings for buyers.
For example, for a second-hand rural home worth €250,000 in the Valencian Community, first-time buyers could save €22,500 by not paying the 9 percent ITP rate in the region.
READ MORE: ITP – What you need to know about property transfer tax in Spain
Feijóo, who took part in an event in Toledo organised by the Association of Families and Women in Rural Areas (Afammer) to mark International Rural Women’s Day, stated that “we must make things easier for young people” who wish to live in rural areas, as well as to ensure “the next generation takes over”.
Much of this, he added, is because rural areas “bear an excessive tax burden”.
“We must make things easier for young people” who want to live in rural areas, he added, pointing to young people to ensure a “generational renewal” of rural areas of Spain.
As such, he went on to pledge the “total exemption” from property transfer tax and stamp duty on the first property purchase for young people under the age of 40.
READ ALSO: How a Vox-PP government could impact foreigners’ healthcare access in Spain
Feijóo also proposed a reduced self-employment contribution of €50 a month for three years for young people under 40 who set up businesses in rural areas; a 50 percent reduction in income tax for the first few years of business activity; a rural relocation grant of up to €15,000; and public guarantees of up to 80 percent for the investments required on farms.
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“Rural Spain cannot be a relic of the past. It must be a place where people can work, where they can start businesses and, consequently, where they can live,” he added, reiterating that the PP does not “accept cuts” to the Common Agricultural Policy (CAP) and stressed that “protecting Europe’s food supply” is also a priority.
READ ALSO: How Spain’s foreigners could be affected by a far-right and conservative government
