Only 25% of the money raised for housing in Catalonia is allocated to residential policies.

BarcelonaOnly 25% of the resources raised through housing-related taxes in Catalonia were reinvested in residential spending in 2023. While the State, the Generalitat (Catalan regional government), and Catalan municipalities—the sample only includes those with more than 25,000 inhabitants—received a total of €4.632 billion during 2023, reinvesting €1.155 billion in housing policies.

This is the main conclusion of a report jointly presented this Thursday by the housing chairs held by the Association of Developers and Builders of Catalonia (APCE) and the real estate agency Tecnocasa with the Pompeu Fabra University (UPF), with the participation of their directors, experts in . The report recommends that administrations reverse these data, that is, balance the relationship between revenue collection and investment in housing.

The study focused solely on assessing and collecting data from Catalonia, so this percentage cannot be contextualized in comparison with other autonomous communities, the country as a whole, or other countries in the European Union (EU). However, the authors argued that this percentage can be assumed to be higher elsewhere, taking into account two premises: that Spain's investment in housing is equivalent to a third of the European average and that, in turn, it is one of the countries with the highest effective taxation on home ownership, with an effective rate of 30.3% compared to 6.5%. a recent study from the Institute of Economic Studies on housing taxation in Spain

Among the taxes analyzed are municipal taxes – such as the IBI (Property Tax), the tax on the increase in the value of land and others related to construction and urban planning –, regional taxes – which include the property transfer tax (ITP), legal acts, assets, empty housing and half of the personal income tax – and half of the personal income tax –. The total 25% is the result of combining the different proportions: in the case of the autonomous community it is 13.3%, in the case of the municipal part, 22.2%, and in the case of the state part it shoots up to 168.1%. However, the speakers have clarified that in many municipalities the net collection was especially negative due to the effect of tax deductions. Regarding the ITP (Income Tax), the president of the APCE (National Institute of Statistics and Censuses), Xavier Vilajoana, warned that increasing the tax rate for different situations, such as large landowners and depending on the price of the property, will not solve housing accessibility because it will increase its cost. "Thirty percent of the cost of a home is taxes," he said.

"In 1994, tax revenue was close to 1%, considering that fiscal expenditure could reach 1.96%, and now Spain is far behind, at 0.1% or 0.2% of GDP, a situation clearly different from the rest of the EU." The report states that if that 25% were tripled to 75%, Spain could end its social housing deficit, which currently accounts for 1.13% of the housing stock, well below the European average of 7.75%.

Territorial inequality

At the municipal level, the largest cities, with the largest populations and highest housing demand, receive the majority of the regional and state resources allocated to this sector. In fact, Barcelona is the city that received the most money, and also the one that spent the most on housing access and construction in absolute terms, with €352 million, followed by Lleida, Santa Coloma de Gramanet, El Prat de Llobregat, and Manresa, with amounts ranging between €6.5 million and €9 million. At the bottom of the list are Sant Vicenç dels Horts, Premià de Mar, Tortosa, Blanes, and Barberà del Vallès, with amounts ranging between €585,000 and €842,000.

Meanwhile, municipalities such as Sant Cugat del Vallès and Sitges, despite having high revenue per home—over €2,500 per residential unit in some cases—allocated less than 15% of these resources to housing policies in 2023.