Property tax has been postponed once again

Property tax shelved. Several Slovenian governments have attempted to introduce a real estate tax, but failed. The latest to do so, the current centre-left government has decided to put the matter on the back burner after its blueprint was torn to pieces by virtually all stakeholders.

The government had long touted a new property tax as a cornerstone of its housing policy, arguing it will drive down property prices and put more rental units on the market.

After repeated promises to do so, the government came up with a blueprint of a new tax on “surplus property” late last year, proposing a levy equivalent to 1.45% of the generalised value of the owner’s second or any additional property.

In the ensuing public consultation period pundits rejected the proposal as a half-hearted attempt, with both those in favour of the tax and those against arguing it was ill-prepared and unfair, mostly because first homes would be exempt from tax regardless of their size.

Since the public consultation period ended in late January no new steps have been taken except for the Finance Ministry announcing on 4 July it was shelving the tax, arguing measures must first be taken to ensure greater legal certainty of owners.

It spoke of the need to weave tax measures into a comprehensive housing policy and the need to improve the legal safety of landlords and tenants. It also expressed concern about possible effects of the tax in terms of high rents and real estate prices.

Instead, all relevant government departments are to now join the effort to introduce fiscal measures that are a precondition to comprehensive measures for the stabilisation of the housing market.

Some measures have already been included in the reform Housing Act now in parliamentary procedure. They are also looking into additional possibilities of faster and more effective resolution of lease disputes, the ministry said.

It added that the government was also continuously working on its housing measures, above all by increasing the stock of public rental housing, combined with efforts to simplify construction permitting.

Source: https://sloveniatimes.com/44066/property-tax-shelved