VAT reduced from 8% to 4% in new home purchases, only until 31st December

The Spanish government announced this reduction at a press conference held last Friday 19th August to help boost the real estate sector and specifically to lower the stock of unsold newly constructed properties.
The reduction will apply only until the end of the year and it is considered a “provisional and exceptional” measure as a reply to the demands of the construction industry which represents 4% of Spain’s GDP.

Salgado, Spain’s Ministry of Economic Affairs, says that this will have a positive impact on economy, improving credit flow and will not increase the so-called ‘real estate bubble’.

For example, a 200.000€ apartment will benefit from approximately 8.000€ reduction.

Diana Morales, 26 Aug 2011 - News