Lowering Value-Added Tax (VAT) on Residences Sparks Debate
During a recent joint session between the Finance and Budget Commission and the National Council of Regions and Districts, several additional article proposals for the 2025 Finance Bill were discussed.
Among them, an initiative to reduce the Value-Added Tax (VAT) to 7% for residential properties sparked debate.
The members of parliament behind this idea highlighted that the surge in property prices is largely due to the increase in construction material costs and high interest rates applied to loans.
They believe that a reduced Vat would ease the cost of housing, making it more accessible to citizens.
It's worth noting that the 2025 Finance Bill currently plans for a 19% Vat on real estate.
The Ministry of Finance remains skeptical, with its representatives considering that the real obstacle lies in access to financing, not in tax rates. Therefore, a reduction in Vat does not guarantee a significant decrease in prices, according to them.
The proposal to reduce Vat to 7% has been added to the 2025 Finance Bill.
