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Tax incentives to strenghten the real estate market

On 8 February 2023, a draft bill no. 8149/00 aiming to revitalize private investment in the creation of housing has been submitted to the Chamber of Deputies (hereinafter referred to as "Bill").

The objective of this Bill, limited in a first phase to the tax years 2023 and 2024, is to address, through fiscal means, the current crisis in the real estate sector, which estimates that the number of housing units completed in 2023 will fall from 3,800 to 2,300, with prices having risen by more than 100% in the last 10 years, according to the Observatory of Housing.

To revitalize investments in housing creation, including rental housing, the following is proposed :

  • To apply the super-reduced VAT rate of 3% also to housing made available to third parties (and not only those used as a main residence by the owner of the housing) .

  • Increase the amount of the tax credit ("Bëllegen Akt") from EUR 20,000 to EUR 50,000 (to be deducted from the registration and transcription fees normally due).

  • To make the accelerated depreciation scheme for rental housing more attractive: 6% during the completion year of the new housing and for the following 6 years (including investment expenses incurred in the case of renovation of an old housing, if the expenses exceed 20% of the purchase price of the property).

Our teams specialized in real estate, construction and tax law are at your disposal in case of questions.

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