BUSINESS

Capital gains tax on property to be suspended for another year

PROKOPIS HATZINIKOLAOU

TAGS: Property, Taxation

The capital gains tax for property ownership is apparently to be suspended for another year. Although it was voted through in 2013, it has never been properly applied due to the major decline in property prices and the complexity of the legislation.

Market sources argue that the implementation of the capital gains tax would require preparation that has not been carried out, with the government signaling it will put it off for one more year. They add that as the property market appears to be returning to life in Athens and at tourism destinations, it would be wrong to apply the tax in 2019.

The legislation provides for the capital gains tax to amount to 15 percent of the gains a property owner secures upon selling a recently acquired asset – i.e. the difference between the acquisition price and the sale price for properties bought after January 1, 2014. Besides the capital gains tax the seller must pay in the above cases, the buyer has to pay a transfer tax of 3 percent of the taxable rate of the property acquired, known as the “objective value.”

The tax was originally suspended due to its complicated nature, leading to the cancellation of hundreds of property transaction contracts signed in the few months it was meant to apply.
 

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