The Basque Parliament approved on 8 October 2026 a legislative amendment extending the classification of publicly protected housing (Vivienda de Protección Pública – VPP) to all residential units located in officially declared tensioned zones across the three provinces. The measure, passed with support from the governing coalition and abstention from opposition parties, modifies the Basque Housing Law 3/2015 and triggers a cascade of fiscal benefits under the region’s autonomous tax regime. The extension applies retroactively to developments licensed since 1 January 2024, provided they meet the new affordability criteria.
Key Takeaways
- Property Tax Exemption: Newly classified VPP units gain a 100% exemption from the Basque Property Tax (Impuesto sobre Bienes Inmuebles – IBI) for 15 years, representing an average annual saving of €1,800 per unit for developers and social landlords.
- Transfer Tax Reduction: First-time buyers of VPP homes in tensioned zones benefit from a reduced Transfer Tax (ITP) rate of 1.5% versus the standard 7%, applicable to transactions formalized before 31 December 2028.
- Developer Deductions: Construction companies investing in VPP projects can deduct 30% of eligible costs from their Basque Corporate Tax quota, with a carryforward period of 10 years, incentivizing private participation in affordable housing delivery.
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.
Source: Read Official Announcement