The president of the Community of Madrid, Isabel Díaz Ayuso, will announce new tax cuts on inheritance and gift taxes and on housing rentals that will generate “a saving of almost 180 million euros per year for taxpayers in the region,” they said in a statement from the regional government.
The Madrid president is expected to put forward these measures in her speech during the debate on the state of the region, which will take place this Thursday at the Madrid Assembly.
In inheritance and gift taxes, the bonus for transactions between siblings and between uncles and nephews by consanguinity, which is currently 25%, will be increased to 50% from next year. “In this way, the Community of Madrid will be the first region to introduce this measure in both types of taxes for this degree of kinship,” they say.
In addition, a 100% bonus will be introduced in the event of sporadic donations between individuals of less than 1,000 euros. The formal requirement to issue a public document to apply existing ones will also be removed.
The regional government estimates that these new tax cuts will save around 130 million euros per year and “will benefit around 13,000 Madrid residents.”
Furthermore, in terms of housing, the scope of a deduction linked to personal income tax (IRPF) has been expanded this year. Thus, the maximum age for being able to apply for the rental of a habitual residence will be raised to 1,234 euros, from 35 to 40 years old. “Around 45,000 taxpayers will benefit from it, who would be added to the 65,000 who currently benefit from it, generating a tax relief of 50 million euros per year,” report official sources.
This housing measure that Díaz Ayuso will announce is added to the bill on tax reductions in this area that is currently being reviewed in the Parliament of Madrid. According to comments from the Community of Madrid, this amendment provides for four deductions from personal income tax for owners who rent out disused housing, to mitigate the increase in variable-income mortgages due to the rise in interest rates and to combat the depopulation of young people under 30 who establish their habitual residence in municipalities with fewer than 2,500 inhabitants, either by purchase or rental.
To this, they can add an additional bonus of 100% on real estate transfer taxes (ITP) in the case of the acquisition of a second-hand house, and on documented legal acts (AJD), in the case of a new house. The total impact of the savings resulting from all these tax reductions in the bill is 118 million euros.
