Spain Backs Down on 100% Tax for Foreign Property Buyers

A Spanish government source reported that Prime Minister Pedro Sánchez’s plan to impose a 100% tax on property buyers from outside the European Union has stalled, due to difficulties in securing the necessary support from nationalist and minority parties in the Spanish Parliament.

The plan, which sparked widespread debate, dates back to January 2025 and aimed to curb competition from high-income foreign buyers in the local real estate market, amid a severe shortage of affordable housing in the country.

Why Has Spain’s Tax on Buyers Stalled?

The government source explained that the new tax is one of the most challenging issues for the administration to gain majority support in Parliament, especially given the coalition government’s reliance on backing from smaller parties on a bill-by-bill basis.

The right-wing nationalist party Junts in Catalonia opposed the plan, arguing that it focuses on restriction and punishment rather than addressing the root cause of the housing shortage.

Meanwhile, the far-left party Podemos criticized the government for lacking the political courage to impose a complete ban on property purchases not intended for residential use.

The source added that Sánchez’s government will continue to discuss the 100% tax in Congress, but it has not yet been included in the second housing bill previously presented to regulate short-term rentals.

This delay is also viewed in the context of preparations for the upcoming elections, scheduled no later than August 2027, adding time pressure to pass such sensitive policies.

The International Monetary Fund recently warned that Spain needs to increase housing supply to address rising home prices, driven by both strong demand and population growth through migration.

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