{"id":1008824,"date":"2023-07-19T12:27:11","date_gmt":"2023-07-19T10:27:11","guid":{"rendered":"https:\/\/www.privatepropertymallorca.com\/?p=1008824"},"modified":"2023-07-26T12:13:03","modified_gmt":"2023-07-26T10:13:03","slug":"new-balearic-government-program","status":"publish","type":"post","link":"https:\/\/staging.privatepropertymallorca.com\/en\/magazin-en\/new-balearic-government-program\/","title":{"rendered":"New Balearic Government Program"},"content":{"rendered":"

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\nThis is what the new Balearic government is planning<\/strong><\/p>\n

The tax plans of the Balearic President Marga Prohens open up new opportunities for property owners and vacation rental companies on Mallorca<\/p>\n

The new government of the Balearic Islands has taken office and is promising a large number of tax cuts. With the conservative People’s Party (PP) forming a minority government, it will need support from Vox’s right-wing populists. Under the Balearic President Marga Prohens, the parties have agreed on a government program. Numerous points promise tax breaks.<\/p>\n

This is intended for the real estate market<\/strong><\/p>\n

People under the age of 30 and disabled people will be exempt from property transfer tax (ITP) in the future when they acquire their primary residence. This regulation applies to properties up to a value of 270,000 euros (or a maximum of 350,000 euros in areas with a tight housing market). In addition, the real estate transfer tax for the purchase of the main residence is reduced by 50 percent if the buyer is under 35 years old or it is a large family (familia numerosa).<\/p>\n

Another planned measure concerns the liberalization of the rental of holiday accommodation. The moratorium that has been in place since 2022, which blocks the granting of new licenses, is to be lifted.<\/p>\n

The new Balearic government also intends to take tougher action against illegal squatting within the scope of its responsibilities.<\/p>\n

These tax cuts should be implemented<\/strong><\/p>\n

The income tax for residents (IRPF) is to be reduced. In particular, taxpayers with low and middle incomes and landlords who make their property available to the long-term rental market benefit from this, because they have additional tax advantages. However, please note: The Balearic government can only decide on half of the income tax, the other part falls under the jurisdiction of Madrid.<\/p>\n

On the other hand, the Spanish regions have greater powers when it comes to inheritance tax. The island government plans to completely abolish the tax on inheritances between next of kin. In addition, a 50 percent reduction in tax on inheritances between siblings and uncles\/aunts and nephews\/nieces is planned. The implementation of this far-reaching reform should take place in the first 100 days of the term of office.<\/p>\n

Furthermore, PP and Vox intend to gradually reduce the wealth tax and, ideally, to abolish it completely during their term of office. However, implementation depends on the abolition of the central government “wealth tax”, which was introduced at the end of 2022. At the end of the year, in response to regional initiatives, the Spanish government decided on this additional state property tax, which applies wherever regions reduce or abolish this tax. The outcome of the early Spanish parliamentary elections on July 23 remains to be seen. However, the definitive and comprehensive abolition of the\u00a0Spanish wealth tax\u00a0for the tax year 2023 has become a scenario that needs to be taken seriously. The prerequisite is an election victory for the Conservatives. In recent months, they have positioned themselves on tax policy and in particular the wealth tax in a way that would make it very difficult for them to backtrack.<\/p>\n

Further measures to promote companies and the self-employed (aut\u00f3nomos) are also planned.<\/p>\n

Quick Overview: What does the non-resident tax package mean in Mallorca?<\/strong><\/p>\n