PLUSVALIA TAX UNDER SUSPICION

Created: Sunday, 12 March 2017

On 16 February 2017, the Spanish Constitutional Court has issued a decision declaring that the Local Tax on The Increase of the Value of Urban Land, commonly known as "Plusvalía Tax" can not be considered as due when capital gains on conveyed urban property are absent.

This was just confirmation of previous decisions issued by the Spanish Supreme Court which has been declaring the same during last years but now the possibilities of recovering the said tax for those taxpayers who paid it in conveyances where there were no capital gains seem to be undoubted.

The Spanish government is considering to change the current Law to accept the said decision but at the moment Local Councils are reluctant to apply the exemption before the Law is changed and tax payers are forced to take them to Court to recover their money.

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