Spain’s proposed Spain 100% property tax on non-EU and non-EEA property buyers has attracted significant international attention.
What Foreign Investors Need to Know – Current Legal Status (2026)
1. Background and legislative context
In May 2025, the Spanish Socialist Parliamentary Group (PSOE) presented a Draft Bill on Housing Measures aimed at curbing speculation and improving access to housing in Spain. Among the measures included was the creation of a new state-level tax known as the:
“State Complementary Tax on the Transfer of Real Estate to Non-Residents in the European Union.”
This proposal immediately attracted international attention due to its extraordinary tax burden on certain foreign buyers of Spanish property.
The draft was formally registered and published in the Official Gazette of the Spanish Parliament (Boletín Oficial de las Cortes Generales).
Official text (Spanish Parliament):
https://www.congreso.es/public_oficiales/L15/CONG/BOCG/B/BOCG-15-B-229-1.PDF
2. Spain 100% property tax: what does the proposal consist of?
The proposed Spain 100% property tax would apply as a state-level complementary charge in addition to existing regional transfer taxes (ITP). The draft bill proposes the creation of a new indirect state tax, which would apply in addition to existing regional transfer taxes (ITP).
Key features of the proposal
- Nature: State-level indirect tax
- Type: Complementary to Transfer Tax (ITP)
- Rate: 100% of the taxable base
- Scope: Transfers subject to ITP (mainly second-hand properties)
In practice, this would mean that a qualifying buyer could be required to pay an amount equal to the value of the property itself, on top of the ordinary regional ITP.
3. Who would be affected?
Taxpayers
The tax would apply to:
- Individuals or legal entities
- Not resident in the European Union
- Acquiring real estate located in Spain
The wording of the draft explicitly refers to non-EU residents, which has generated debate regarding the treatment of EEA residents (Norway, Iceland, Liechtenstein) and potential conflicts with EU law on capital movements.
Transactions affected
- Second-hand residential or commercial property purchases
- Transfers of real estate rights subject to ITP
- Transactions not subject to VAT
Transactions excluded
- New-build properties subject to VAT
- Transfers carried out by developers or professionals under VAT rules
- Certain corporate restructurings
4. When was it presented and voted?
- Draft bill presented: May 2025
- Admitted for parliamentary processing: Late May 2025
- Committee discussions: June–July 2025
Has it been approved?
No.
As of January 2026, the proposal:
- Has not been approved by the Spanish Parliament
- Has not entered into force
- Is not currently applicable law
The bill remains under parliamentary consideration, subject to amendments, political negotiation, or potential withdrawal.
5. Current legal status (2026)
At present:
- The tax does not exist in force
- There is no effective date
- No implementing regulations have been approved
- Property purchases by non-EU / non-EEA buyers remain subject to the existing tax framework
However, the proposal is politically relevant, particularly for foreign investors planning medium- or long-term acquisitions in Spain.
As of 2026, the Spain 100% property tax remains a legislative proposal and is not in force.
6. Legal and practical concerns
The proposal has raised significant concerns among legal and tax professionals, including:
- Compatibility with EU law, particularly the free movement of capital (Article 63 TFEU)
- Potential discriminatory treatment of foreign investors
- Questions regarding confiscatory taxation
- Legal uncertainty for international buyers and investors
It is also important to clarify that this proposed complementary tax is completely separate from Spain’s cadastral “reference value” system, which is intended to establish a minimum taxable value linked to market reality for existing taxes. The proposed 100% complementary tax does not adjust or rely on the reference value mechanism. For a detailed explanation of how the reference value works in practice and how it affects property taxation in Spain, see our article on the Spanish property reference value:
👉 https://www.jmslawyer.es/2022/11/15/property-reference-value/
From a broader perspective, this proposal appears to be part of a wider political response to Spain’s ongoing housing shortage. In practice, access to housing is influenced by multiple structural factors — including planning policy, supply constraints, demographic pressure and investment patterns — and not solely by foreign demand. In this context, the measure seems aimed at addressing housing availability through fiscal policy, although its effectiveness and proportionality remain subject to debate.
If approved in its current form, the measure would represent one of the most aggressive property tax policies in Europe for non-EU investors.
7. What does this mean for non-EU / non-EEA buyers today?
If you are:
- Considering buying a home in Spain
- Planning a real estate investment
- Acquiring property through a company or holding structure
- Investing from the UK, USA, Canada, Australia, China, or other non-EU jurisdictions
The current legal framework still applies, but future planning is essential.
Transaction structuring, timing, residency status, and tax exposure must be carefully analysed before committing to a purchase.
8. Professional advice is essential
Legislative proposals of this nature demonstrate how quickly the legal and tax environment can change for foreign buyers in Spain.
Early legal advice allows you to:
- Assess current and future tax risks
- Structure acquisitions efficiently
- Avoid unnecessary exposure
- Make informed investment decisions
Call to Action – Speak to a Spanish Property & Tax Lawyer
If you are buying or investing in property in Spain from outside the EU or EEA, or if you want to understand how this proposal could affect your plans, professional advice is strongly recommended.
For tailored legal and tax advice on:
- Property purchases in Spain
- International investors and non-resident buyers
- Cross-border tax planning
- Real estate investments and structuring
👉 Contact us to discuss your case before committing to any purchase.
Early planning is the key to protecting your investment in Spain.