Spain is taking advantage of Portugal’s announcement to close the Non-habitual Residence (NHR) scheme, leading Spanish authorities to create a new tax relief regime for former residents.
Portugal’s government earlier this month said that it would abolish the NHR tax regime, which allows internationals to benefit from reduced tax rates on income for ten years, SchengenVisaInfo.com reports.
The closure of the NHS tax regime by Portugal’s government has been taken as part of efforts to improve the housing market. However, Real Estate Consulting and Valuation companies don’t believe that it will solve the housing crisis in this country.
The President of the Association of Real Estate Consulting and Valuation Companies (ACAI), Jorge Bota, said that Spain immediately took advantage of the episode to publicise its scheme, which is similar to the Portuguese one after it recognised that it had lost a very competitive competitor.
Portugal is clearly losing a factor in attracting staff, especially when the economy needs them, whether due to the low unemployment rate, the inability to retain our talents or the added value of the sectors in which they operate economically.
He believes that it will not be a measure that will solve the housing crisis in Portugal, according to Portugal News.
Only 27 per cent of non-habitual resident (NHR) wealthy expats in this country have structured their financial and tax future beyond ten years, based on a survey by the World Digital Foundation.
Such statistics indicate that a large number of expats living in Portugal could be caught out by the abolishment of the NHS tax regime announced for next year.
Recently, Portugal News reported that a Swiss developer who had planned an investment of over €100 million in Lisbon decided to cancel the project, following the decision confirmed by Portugal’s Prime Minister, Antonio Costa.
According to the CEO of the Overseas developer, Pedro Vicente, at issue was a project of a total of 150 residential units for middle and upper-middle-class Portuguese in the centre of Lisbon, as reported by Jornal Economico.
The Swiss investor who was going to go ahead with us told us that they had lost confidence in the Portuguese market and that they were very worried about the effect this decision would have on the market. It was an investment of more than 100 million euros.
CEO of the developer Vanguard Properties, José Cardoso Botelho, considered that by giving up non-habitual residents, the country will lose tax revenue and will cause investors to move away from the Portuguese market, according to Portugal news.
While announcing the closure of this scheme, authorities in Portugal said that they will introduce an NHR tax regime alternative for scientific research and innovation from next year, thus allowing several professions to take advantage of it.