Andalucia, which includes Spain’s popular Costa del Sol, has scrapped a “wealth tax” paid by second homeowners in the region. This move is likely to provide substantial benefits for British expats in Andalucia.
The wealth tax “el impuesto de patrimonio” applied to residents and non-residents with a net worth of more than 700,000 euros (£624,000).
The tax has now been removed in a huge boost for British expats who own property in the area.
Andalusia hopes the move will attract more investment and well-paid taxpayers to the region.
A statement on the Junta de Andalucia website reads: “Andalusia must be competitive and compete against the best.”
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Regional President Juanma Moreno tweeted: “In 2023 alone, (the Wealth Tax Cut) alone will leave €360,000m (£321m) in the pockets of Andalusians .”
According to government statistics, wealth tax was only 0.6% of the region’s annual income.
However, the regional government felt it was deterring wealthy investors from settling in the Spanish hotspot.
Andalucia is one of the most popular regions in Spain for expatriates and many Britons have chosen to call it home.
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Around 90,000 Britons live in the region which includes Marbella, Malaga, Granada and Cadiz.
British expats are often part of vibrant British communities and can get by without speaking Spanish.
Since Brexit, expats have had to follow new rules and will need Spanish residency to live in Spain.
Britons without residence will need to apply from within the UK and may need to provide many documents.
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It is still possible for Brits to own second homes on the Costa del Sol, although they will have to follow certain rules if they want to remain British citizens.
Britons can visit the EU 90 days out of 180 and must have their passport stamped on entry and exit.
British citizens could be detained, fined or even banned from entering the EU if they exceed the limit.
Passport stamps will prove when a UK citizen has entered and left the EU, although airline tickets can also be used as proof.
According to the property experts at idealista Spain, house prices on the Costa del Sol are generally cheaper than in the rest of the country.
However, it is a more expensive area to buy property than the Costa Blanca, which includes Benidorm and Alicante.
The cheapest areas to buy a house on the Costa del Sol are Casares, Estepona and Manilva.
Prices in the port town of Manilva are under €2,000 per square metre, making it a more affordable option for UK expats.