The apartments are for living: Spain will dilute tourists with VAT

The Spanish government is seeking parliamentary approval for twice-higher VAT for properties given with short-term tourist rentals than those for hotel rooms, in an attempt to cope with the housing crisis.

The maximum tax rate of 21% will apply to all rents under 30 days and will affect about one-third of the 94 million annual visitors to Spain last year who chose to rent a home instead of a hotel room. Currently, short -term rents in continental Spain are exempt from VAT, while hotel visitors pay a 10% tax on rooms.

Spain is trying to balance tourism as a driver of the economy and public concern about the high costs of housing that are shortened, as landlords prefer to give their real estate to tourists, which is more lucrative.

Discriminatory

A report from the Bank of Spain this week indicates that the country has a deficit of 450,000 dwellings. Half of the Housing Fund of the Canary and Balearic Islands is either tourist accommodation or homes or ownership of people who do not live permanently on them.

Apartur – the Association of Tourist Apartments Owners in the second largest city in Spain, Barcelona, ​​claims that property owners leased to short -term rents must pay the same VAT as hotels and calls the proposed VAT rate of 21% discriminatory.

The bill under consideration also includes a controversial measure announced for the first time in January for taxation of property buyers who do not have European citizenship, up to 100% on purchases, unless they are their main home, as well as increasing taxes due by the owners of empty property, including those used as holiday homes.

« The sole purpose is to put an end to these activities and (tourism) to leave it in the hands of hoteliers, » says Javier Penate, a legal advisor to the Association of Holiday Housing owners in the Canary Islands, where Airbnb landlords already pay 7% VAT as well as hotels.

Local and regional authorities also restrict the new licenses for renting tourist property in Malaga and Madrid, while completely prohibiting them in Barcelona until 2028.