Spain’s proposed 100% property tax for non-EU buyers: genuine move or political posturing?

A surprise announcement by Spanish Prime Minister Pedro Sánchez on 13 January has sparked alarm among non-EU property investors.

A surprise announcement by Spanish Prime Minister Pedro Sánchez on 13 January has sparked alarm among non-EU property investors.

His government aims to introduce a tax of up to 100% on properties purchased by non-EU buyers, with the stated goal of easing Spain’s housing crisis by giving local residents priority over foreign investors. However, details remain sparse, and the legislation still faces multiple hurdles in Spain’s parliament – no easy task given the Prime Minister’s lack of a strong majority.

Many observers interpret this move as part of a broader, more hard-line shift against overseas wealth in Spain. Following the recent abolition of the Golden Visa scheme, there’s a concern that the government is deploying new fiscal barriers to deter international buyers. Indeed, the socialist government is under mounting pressure from Spanish nationals who are struggling to afford housing in the face of the ongoing cost-of-living crisis. The optics of wealthy foreign investors snapping up Spanish properties clash with the administration’s left-wing priorities.

Yet Spain also depends heavily on the economic benefits brought by foreign residents and tourists. Tourism is the country’s leading export, and many people relocating to Spain create significant tax revenue and employment. A more measured approach may be needed to balance domestic needs with international investment, ensuring that Spain’s property market remains accessible without alienating buyers who help sustain local economies.

Notably, the new measure appears designed to target speculative purchasers – those non-EU buyers who leave properties unoccupied for much of the year and contribute limited tax revenue or social value. The challenge will be determining how Spanish authorities monitor and enforce such a policy.

This announcement comes just as the Golden Visa scheme heads towards its 3 April 2025 deadline. Buyers hoping to secure a Golden Visa before the cut-off are now faced with added uncertainty. It remains unclear how quickly any potential 100% tax on property purchases could come into force, but the lack of clarity alone may deter prospective investors.

If you do wish to pursue a Golden Visa, you should plan to complete your property purchase as early as possible in January to allow time for the visa application. The government has stated that while new applications won’t be accepted after 3 April 2025, those already submitted – and all existing Golden Visas – will still be processed and renewed.

Ultimately, investors and potential expats will be watching carefully for more specifics from the Spanish government. Swift clarification would allow buyers to decide whether Spain is still a viable long-term property investment or whether these policies might, in the end, prove too costly and complex.