Such changes may include a 5% reduction in the VAT rate for buyers of primary real estate with an area of up to 250 square meters. VAT in the amount of 15% for housing with an area of 250 to 300 sq. m. The abolition of fees for the transfer of ownership of real estate for three years is also being discussed.
Such measures are being taken in order to activate the country's real estate market and attract foreign buyers, whose number has also decreased. According to the OPP report, over the past two months, the number of purchases housing in Cyprus decreased by 28%. Only 122 residential units were sold to foreign buyers, compared with 169 in June and 187 in May this year. The number of home sales in Cyprus has been declining for 13 months in a row, in general, sales decreased by 20% over the year.
Other countries have also recently revised their tax systems. In particular, in Spain, the VAT rate on the purchase of new housing has been reduced from 8% to 4%.
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