Spain’s proposed 100 percent tax on property buyers from outside of the European Union, which aimed to double real estate prices for non-EU purchasers, has stalled completely following the dissolution of Parliament and a shift in government legislative priorities.
The Origins of the Foreign Property Supratax
During 2024 and 2025, housing affordability dominated Spain’s political landscape amid dwindling stock and spiralling prices. With public anger directed heavily at affluent foreign buyers and holiday lets, the Spanish Prime Minister proposed a radical countermeasure. The plan featured restrictions on tourist apartments, provisions to secure public housing stock, rental price incentives, and the headline-grabbing supertax targeting non-EU buyers.
The measure directly threatened British buyers purchasing holiday homes in Spain, as Brexit had categorized them as non-EU residents. According to the legal text for the proposed “Complementary State Tax on the Transfer of Real Estate to Non-EU Residents,” the levy applied a 100 percent tax rate to the taxable base, effectively doubling the purchase price of second-hand properties for buyers outside the bloc.
Parliamentary Stagnation and Shift in Focus
Despite generating international headlines and intense debate, parliamentary records confirmed that the bill was not formally debated once by Parliament by the end of March 2026. It saw no readings, committee reviews, or plenary discussions.
In January 2026, the government presented a revised housing reform package focusing on tax incentives for landlords who renewed agreements without raising rents, tighter restrictions on holiday lets and room rentals, and an affordable housing scheme in Madrid pledging 10,700 homes. The 100 percent tax was omitted from the text.
Sánchez announced two additional housing decrees following the rejection of similar bills by the Spanish Congress. Because Parliament has since been dissolved, the Standing Committee (Diputación Permanente) took charge of evaluating these rejigged housing measures. The revised agenda shifted its focus away from non-EU buyers toward large-scale property owners and institutional investment funds, commonly known as vulture funds.
Election Outlook and the Future of the Levy
With the dissolution of the Spanish Parliament, all pending legislative bills lapsed. While a Socialist administration could theoretically reintroduce the policy in a future mandate, opinion polls indicate that Spain’s centre-right Partido Popular (PP) is positioned to win the general election, potentially in a coalition with the far-right Vox party.
A PP-Vox government would likely drop the 100 percent tax in favour of cutting property taxes. Furthermore, even if the Socialist-backed bill had survived a parliamentary vote, it faced a high probability of legal challenge before the Court of Justice of the European Union for potentially breaching rules governing the free movement of capital.
