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Capital Gains Tax to Be Abolished From 2008
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Published: 30/04/2008 - by mmm&m Monero, Meyer
& Marinel-Lo
phkirchheim@mmmm.es
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In line with promises made by various
party candidates of the Spanish government, the Minister of Economy,
Solbes, has recently declared that Capital Gains Tax in Spain will be
abolished. With this act, Spanish is one of the last European countries
to revoke a tax that was a residual of a former era.
According to official data, this abolishment will benefit the one
million tax payers that generated approximately 1,400 million Euros of
tax income in 2005. In practice this tax was applied in quite an uneven
manner, with its tax payers generally being those that had previously
made a declaration for this tax. With regards to non-residents, they
acted as a Damocles´ sword given that they too were passively
subject to this tax. In the majority of cases these non-residents owned
properties in Spain and were obliged every year to present a series of
declarations which encompassed Capital Gains Tax and Income Tax for
non-residents. This obligation was also not very evenly distributed
since many non-residents did not submit it; however it was necessary to
be able to assure any possible refund in the case of a buyer
withholding too much when selling a property. It should also be
mentioned that this Tax will continue to be relevant for financial
years of 2007 and earlier, until its expiration within the timeframe of
4 years (this being for residents up until 2012 and for non-residents
until 2013).
It is yet to be determined how tax payers will act in relation to the
relevant declaration of the 2007 Capital Gains Tax which must be
presented in the next few months, and will continue to be in force.
Finally it is important to mention that this abolishment is very
positive and puts Spain in a better competitive position with regards
to its neighbouring countries.
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hotline inmobiliaria ksr
(+34) 928 76 66 84
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