Capital Gains Tax to change in Spain.
Currently Spanish residents who sell their main Spanish residence are charged Capital Gains Tax, but if they reinvest the proceeds into another main residence, the CGT is then waived.
Non-Spanish residents who do the same thing are still hit with a tax bill even if they reinvest in property in Spain and Brussels has now given an ultimatum to the Spanish Government that this rule must be changed by the end of December this year or face being taken to the European Court of Justice…just another thing to add to their list of woes…!!!
The EU has decided that this rule is a case of fiscal discrimination and must be changed and they have been given 2 months to make amends to allow the same tax break to all EU ex-pat residents and not just Spanish residents.
Apparently, Spain has been warned about this type of discrimination before but has not acted, but with the threat of being taken to the European Court of Justice, I can’t imagine that they will be ignoring this final warning.
The EU says that this situation is “Incomparable with the fundamental rights of established EU treaties”
I cannot see that this will improve the general state of the property market, but it will certainly financially benefit some of the EU residents who are not permanent Spanish residents and as such may marginally bring more properties to market.