Property acquisitions in the Canary Islands have seen a significant rise in associated tax costs. Revenue from the Transfer Tax (ITP) and Stamp Duty (AJD) has grown by nearly 20% in the last three years, coinciding with a period of acute housing emergency and price escalation in the archipelago.
This revenue increase benefits public coffers but complicates housing access for Canary Islanders. An report by Ernst & Young indicates that the accumulation of fiscal figures in Spain related to housing contributes to its rising cost and constitutes an anomaly within the European Union.
In the first quarter of the year, Hacienda Canaria collected 88 million euros through ITP, a tax levied on the resale of second-hand homes. This figure represents a 13% increase compared to 2023 and a considerable rise when compared to three years ago, given that the general tax rate is 6.5% of the property's value.
Meanwhile, AJD, which taxes the formalization of notarial contracts, contributed 24.9 million euros in the same period. Although stable compared to the previous year, the figure has increased by 45% compared to three years ago, reflecting the impact of property values on revenue.
In addition to these taxes, public administrations receive income through municipal capital gains tax and the Property Tax (IBI). These fiscal figures, according to the Ernst & Young report, contribute to the increased cost of new housing and hinder access, particularly for young people.
