The Government has approved a decree-law in the Council of Ministers that abolishes the extraordinary 15% contribution for local accommodation, as well as the rule that prevented a reduction in the property tax on these properties, after Parliament gave legislative approval to do so. The measure will apply retroactively to December 31, 2023.
Without going into details, Prime Minister António Leitão Amaro announced during the briefing of the Council of Ministers that the government “has approved a decree authorized by Parliament that implements the law that eliminates the extraordinary contribution for local accommodation and creates rules for the IRS”.
The same legislation facilitates the tax exemption of capital gains from the sale of a house that are reinvested in the purchase of a permanent home and allows workers who move more than 100 km from their place of residence to deduct the cost of the new rent from the income from the property acquisition related to their original home.
Two months after the Assembly of the Republic approved the request for legislative approval with the votes of the right (PSD, Chega, IL and CDS) and the PAN, and against the votes of the entire left (PS, Bloco, PCP and Livre), the Executive of Luís Montenegro was finally able to advance the repeal of several measures from the “Mais Habitação” package of the previous government of António Costa.
The extraordinary tax of 15% on local accommodation (AL), as well as the age coefficient applied to these properties, which prevents the age of the buildings from being taken into account in the reduction of the IMI, have been abolished with effect from 31 December 2023. The retroactivity thus ensures that the owners of these businesses do not have to pay the contribution.
It should be noted that this tax had to be paid until June 15. However, the current executive postponed the deadline for paying the contribution by 120 days, equivalent to four months, to October 15, until it could approve the lifting of the regime, which has now happened. Since the approved diploma takes effect on December 31, 2023, that is, it affects the tax year of last year, AL owners will no longer have to pay the tax this year for the 2023 taxable event.
