Grupo Vapf

Reduced VAT until December 31, 2011

The Spanish Government has approved through the Royal Decree 9/2011 act, a temporary reduction of VAT on new housing from 8% to 4%, as a temporary measure for boosting the economy. This VAT reduction is valid for 4 months, so it will be available until 31 December , 2011.

This new economic measure was approved on Saturday 20 August , after publication in the Spanish Official State Gazette (BOE).

The VAT reduction will be an incentive to buy a new home in Spain over the next months of 2011, as from the day of publication of the decree, a buyer of a new home valued at 100,000 Euros has to pay just 4,000 in taxes, when that amount would had been 8,000 Euros before the tax reduction .

It should be noted that this measure applies only to new homes because second hand homes that do not pay VAT but transfer tax paid to the regional administration, so resale will not benefit from this reduction.

This reduction coupled with the discounts offered by developers and builders in Spain increase the attractiveness of buying a new home, especially if the decision and the preferred destination are unclear, as is the case with European buyers of second residential on the Spanish coast. This is certainly a very good opportunity to take a decision and turn a dream into reality.

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