Real estate owners brace for new levies
The new objective values (property rates used for tax purposes) to be announced in mid-June will only be the starter for property owners, as it is expected that the main course will be particularly hard to digest when it comes in 2019.
The post-program tax shock for hundreds of thousands of owners will include a change in the property transfer tax rates, the activation of the capital gains tax on transfers (suspended till end-2018), the launch of the automatic system for updating the objective values, and the inclusion of arable land and plots outside town planning in the sum of assets that incur the supplementary property tax.
Worse, the government is also considering the introduction of a new property ownership tax that would be based on the entire set of assets that each owner possesses.
The activation of the automatic mechanism for updating the taxable rates will revive the long-frozen issue of estimating the prices of farms and plots outside town planning zones. The total value of those real estate assets is estimated at 110-130 billion euros, and for now they do not count toward the supplementary tax, while incurring particularly low Single Property Tax (ENFIA) rates.