Higher property taxes for good sun exposure and fine views, the so-called ‘sunshine tax,’ will not apply to properties with a rateable value of under €250,000.
Parliament today approved a proposal from Portugal’s Communist Party that limits the 5% Imposto Municipal sobre Imóveis (IMI) sunshine tax increase for properties with a rateable value below €250,000.
The parliamentary committee for Budget, Finance and Public Administration approved this Wednesday, 19 October, the Communist proposal to limit the increase that was to enable increases of up to 20% or a decrease of 10% in the assessment of properties to determine their taxable values.
The measure has been controversial, provoking challenge from left and right wing parties so a parliamentary review was requested and several amendments were presented.
The happy result is the €250,000 ‘valor patrimonial tributário’ limit for the 'sunshine tax.'
"The Communist Party’s initiative was approved so the overwhelming majority of homes that have a patrimonial value of up to €250,000 will not have any increase in the tax," explained Algarve MP, Paulo Sá.
Comments
How are the property values of €250k for the "Sun Tax" and €600k for the "Wealth Tax" going to be decided upon.
1) Are they what the owner actually paid for the property, which could have been years ago.
2) The current VPT valuation by the authorities.
3) Another, yet to be decided upon method.
This is a new tax i.e. a 'wealth tax' which is in addition to the proposed new 'sunshine tax' ....... as well as raising the tax rate on certain income from property e.g. holiday lets from 15% to 35%..
These socialists certainly know how to encourage foreign residential property investment in Portugal.....
No, imo Wealth Tax is yet another Tax, as said for properties with a value over a 600.000 euro.
Sunshine Tax is for Euro 250.000 and more.
So if you are falling into the category Wealth Tax, you pay both Wealth Tax and Sunshine Tax!
Portugal Proposes 'Wealth Tax' On Property
by Ulrika Lomas, Tax-News.com, Brussels
19 October 2016.
Portuguese Prime Minister Antonio Costa has confirmed that proposals for a new real estate tax on high-value property have been included in the Government's Budget for 2017.
The proposed new tax, described by Costa as a "wealth tax," will be imposed on the value of properties over a EUR600,000 (USD660,000) threshold at a rate of 0.3 percent.
The measure is expected to raise an additional EUR160m in revenues annually, which will be used to buttress Portugal's state pension system.
The 2017 Budget also includes a measure to increase tax on income derived from letting out properties to tourists from 15 percent to 35 percent, which includes short-term lets arranged through online platforms such as Airbnb.
Portugal is attempting to avoid being punished with fines by the European Union for consistently failing to meet budget deficit targets, and earlier this year it was given additional time to formulate an appropriate fiscal plan. However, the 2017 Budget will still require the EU's approval.