The tax relief is "absolutely necessary". | Pere Bota

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The Balearic Government calculates that 5,701 residents have saved close to 60 million euros tax on the purchase of first homes under a scheme that was introduced in 2023. Depending on criteria, buyers have not had to pay up to 100% of the ITP (property transfer tax). The 100% saving has applied to people under the age of 30 and those suffering from at least a 33% disability. In this category there have been 1,068 people who have saved a total of 22.6 million euros.

Vice-president and minister of finance Antoni Costa says this was "an absolutely necessary" measure to help social groups that have most difficulties in purchasing their first home in the Balearics. Costa accuses the previous government of having created a "critical" housing situation.

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A purchase price maximum of 270,000 euros was set to be able to qualify for the tax relief, Costa having announced on Wednesday that the government is looking at raising this to 350,000 euros in areas of the Balearics where there is the greatest price pressure and difficulty with accessing housing. Calvia and Palma are two municipalities he mentioned.

For Costa the tax relief is part of a framework of measures for tackling the housing problems in the Balearics. Other elements include the government's Build to Rent and Safe Rental schemes. "We believe these are the way forward."

The Housing Observatory that the government is in the process of establishing will be responsible for providing "reliable and objective data" on which to base possible extensions of the ITP scheme. The intention is to apply extensions this year in areas that are considered to be a priority, e.g. Calvia and Palma.