en 
The discussion of this proposal for legislative authorisation from the Government that grants an exemption from IMT and Stamp Tax to young people up to the age of 35 when purchasing their first home had taken place the day before in plenary.
The measure proposed by the Government – and which the executive intends to come into force in April – grants an exemption from IMT and Stamp Tax on the purchase of a house whose value (for the purposes of paying these taxes) does not exceed 316,772 euros, or that is, the equivalent of the 4th tier of the IMT tax rate.
The measure also includes a partial exemption for houses between 316,772 and 633,453 euros (with an 8% rate on this portion).
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Another rule change that will have unintended consequences. The incidence of property transaction taxes falls on the vendor, even though they're paid by the buyer.
An example: someone buys a house for €200,000 and pays €10,000 in transaction taxes. That means they're paying €210,000. When the transaction taxes are abolished, the price of the house will rise to €210,000, as that's what the buyer can afford, and competition from other prospective buyers in the market.
So it's the vendor who benefits from the abolition of the taxes, as he pockets an additional €10,000 from the sale, while the buyer still pays €210,000 for the house.
Conclusion: this measure will boost house prices and do nothing to help young people more easily afford to buy.
By Billy Bissett from Porto on 15 Jun 2024, 10:41