The Municipal Capital Gains Tax (Impuesto Municipal sobre Plusvalías) is a local tax that Spanish municipalities levy on homeowners who sell their property for a higher price than they paid when they purchased it. This tax is calculated on the increase in the value of the land between the time of purchase and the time of sale.
This tax, paid by the seller, is calculated on the basis of the increase in value that the property has experienced during the time it has been owned. The amount of the Plusvalia Municipal can vary between municipalities and, therefore, it is advisable to consult with the local administration to know the exact amount before making the sale, and thus to be able to take into account one of the expenses that the seller has to face. This tax is applied to the property when it is transferred, not only in case of sale, but also in case of donation, inheritance (succession) or any other form.
This tax is regulated by Article 108 of the Ley Reguladora de las Haciendas Locales and applies to the transfer of real estate, such as land, buildings and dwellings, although it does not apply to assets related to agriculture, livestock or forestry.
The municipal capital gains tax in Malaga can be calculated through the web page of the Malaga Town Hall (you can check online which is the most beneficial method for the seller of the property) and can even be paid online through the web page.
In 2023, the municipal capital gains tax will be increased by 4%. This measure will affect all property owners, who will have to pay an additional tax when they sell their property. It is estimated that this measure will generate additional revenues of around 2,000 million euros for Spanish municipalities.
In addition to the above, other tax developments related to home sales are expected in 2023. Among them, the government has announced a plan to eliminate the current tax rebates on transfer tax (ITP) and stamp duty (AJD). Likewise, new mechanisms will be introduced to avoid tax evasion and the deadlines for filing tax returns for this tax will be made more flexible.