6 February 2015 – Expansión
Yesterday, the Mayor of Madrid, Ana Botella, who revealed last September that she would not stand for possible re-election in the upcoming municipal elections, announced further reductions in the municipal taxes, which will come into force from 1 January 2016 and will have an impact of €250 million.
The majority of the new tax relief from the capital’s Town Hall, the third announcement in two years, relates to Property Tax (IBI), which will result in an average reduction of 20% for citizens. The tax will thereby return to its levels in 2011, according to figures released yesterday by the Town Hall. This amounts to an average saving of around €78. The reduction will represent a decrease in the Town Hall’s coffers of €183 million.
This new reduction has been made possible thanks to a new surplus in municipal funds, which amounted to €1,389 million in 2014, an increase of €423 million on the previous year, according to the preliminary year end figures released yesterday.
As well as enabling new debt repayments and the allocation of more funds for investment, the new surplus will provide support to the accounts of all of the Public Administrations. The Town Hall will alone contribute more than one tenth of GDP to offset deviations from the rest of the State’s deficit, to boost the achievement of its objective.
The municipality’s remaining cash amounted to €386 million at the end of 2014, slightly below the figure in 2013 (€406 million), of which €334 million related to a loan from the Supplier Payment Fund, says the council.
In addition to the decrease in IBI, the Town Hall announced other reductions. It will apply a 7% reduction in the municipal capital gains tax, which will mean lost revenues of €52 million for the city’s coffers from 2016 onwards.
Botella also announced changes to the Tax on Construction, Facilities and Building Work (ICIO) with a discount of up to 95% for building works whose cost does not exceed €150,000, from the second quarter of 2015 onwards. Building works costing up to €300,000 will receive a 50% discount, whilst those amounting to less than €500,000 will receive a 25% discount. A 100% exemption will also apply to the planning permission fees linked to such building works. This measure will have an impact of €13 million.
The City of Madrid recorded total debt of €5,936 million at the end of 2014, compared with €7,000 million a year earlier.
Original story: Expansión (by B. García)
Translation: Carmel Drake
The post Botella Announces A 20% Reduction In IBI From 2016 appeared first on Aura Real Estate Experts.
Source:: AURA Real Estate Experts