MABEL Cabrer, the Balearic minister for public works, announced yesterday that the government will reduce the tax on the transfer of patrimony next year. It is hoped that this will help reduce the price of housing on the islands, which has been rising steadily since 1998.
The tax will be reduced from seven to three percent for people under the age of 35, large families, the disabled and people on low incomes.
The tax is levied on every purchase of a used home.
The reduction will be reduced gradually.
Next year, it will be charged at six percent, and the government will repay one per cent a year until the three percent level is reached. That is, the government will initially charge more than it should, but will gradually repay the difference. The government hopes that by reducing the tax burden, the cost of housing will be reduced.
Last year, the government raised 271 million euros in this concept.