Spain will increase taxes on tourist rentals

Madrid. Spain plans to increase taxes on vacation rentals so that owners pay like a businessThe president of the government, Pedro Sánchez, said yesterday, while residents of the country’s main cities deal with rising rents.

It is not fair that those who have three, four or five apartments for short-term rental pay less taxes than hotels or than workers.added Sánchez at an event on affordable housing held in Madrid.

The measure would be based on a new European Union (EU) directive on value added tax (VAT) for digital platforms, he said. Spanish hotels now pay a reduced VAT of 10 percent, which is included in the bill.

Housing has become one of the main problems in Spain, which struggles to find a balance between promoting tourism, one of the main drivers of its economy, and concerns about high rents due to gentrification and changing housing. owners to more lucrative, short-term tourist rentals, especially in urban and coastal areas.

Sánchez also promised tougher measures to combat fraud with this type of rental, without going into details. Last month, authorities opened an investigation into Airbnb for failing to remove thousands of misleading rental offers from its platform.

Additionally, homeowners in high-income areas who keep their rents in line with an official price index will get a 100 percent exemption from the tax on that income.

Social focus

The president added that the government will promote the construction of social housing and will transfer 2 million square meters of residential land to a newly created public housing agency.

Last year, the Bank of Spain recommended that the authorities intervene in the rental market, since the high proportion – compared to other EU countries – of households that cannot afford to pay their rents could cause adverse economic and social effects.