Public administration and disconnection from reality
08/10/2021 Often I spend time thinking about how to do things better on a personal level, or see what could be improved in other areas.
Unfortunately, when improvements are in the hands of public bodies, which are disconnected from the reality of ordinary people, things become difficult to understand.
This week I have looked at the different tax rates, according to the autonomous community, that exist in Spain for the acquisition of a second-hand home, where the highest percentage of sales transactions in the country is located.
At first, it seems that they all have to be the same, but nothing could be further from the truth. The Property Transfer Tax, which is levied on the purchase of second-hand homes, ranges from 4% on the purchase value in the Basque Country, to 10% in Cantabria, Catalonia, the Valencian Community and Galicia.
The reality is that it affects, not only private buyers, who suffer an unfair affront to their assets to acquire a basic necessity, such as the habitual residence, but also that this tax rate directly affects the investor client, who will see reduced your profitability by a serious percentage on the investment.
Again, the decisions of public entities contradict common sense, the reality of the street and focus on the short term, instead of making things easier for citizens, who will mostly be mortgaged for a third of the years that they are going to live, a fact that leads us to exclude the consideration of “luxurious” in their acquisition.
In the case of investors, be they individuals or companies, good returns (on which taxes will be paid) are those that activate and attract money from abroad, and little help to make purchases in Catalonia, before the comparative offense with other communities that, probably thanks to their much lower rates, will be in the crosshairs of investors to make their assets profitable.
Sirs, justice and common sense.