in 2009 rules created to attract foreign capital to Portugal, which was hit hard in the 2008 financial crisis, provided for total and then partial tax exemptions. Around 10,000 people benefited from this reduction. people, mainly from France, the United Kingdom and Italy, settled in Lisbon and the southern Algarve region. The rules applied to foreigners living in Portugal for at least half the year until 2020, meaning they were exempt from income tax, although a reduced tax rate was was subsequently proposed.
But the measure has contributed to the rapid rise in property prices over the past decade, leading Prime Minister Antonio Costa to brand it a “fiscal injustice” and withdraw the relief from l ‘next year.
Research shows that between 2012 and 2021 property prices in Portugal increased by 78 percent, while at that time in the entire European Union – by only 35 percent.
Thousands of Portuguese took to the streets of Lisbon and 20 other cities across the country on Saturday to demand stronger government intervention to control unaffordable housing prices.
In addition to removing this exemption, Mr Costa’s government also announced a number of other measures, such as the obligation to rent apartments if they have been vacant for more than two years.
In February, Portugal announced it was ending the issuance of “golden visas” to wealthy foreign investors. Last week, the Costa government also decided to cut interest rates on loans for two years, which could help around a million families.
Source: The Delfi
