The government abolished the RNH: Spain took immediate advantage

Portuguese Prime Minister Antonio Costa has announced his intention to abolish the independent resident (RNH) regime in Portugal. This decision has caused alarm in the market and is contained in the state budget proposal for 2024 (OE2024), together with a new, more limited tax incentive. This news has caused a storm of emotion not only in Portugal, but also in Spain, where they are preparing to create a new tax system for former residents.

"Spain immediately took advantage of this episode to proclaim its program because it recognizes that it has lost a very competitive competitor," warns Jorge Botha, president of the Association of Real Estate Consulting and Appraisal Companies (ACAI), in an interview with idealista/news. "Portugal''is clearly losing attraction for staff, especially at a time when the economy needs them, whether it's because of low unemployment, a lack of ability to retain our talent or the added value of the sectors in which they operate,' he adds.

According to (also) partner at consultancy B. Prime, the abolition of the RNH in Portugal - the OE2024 proposal would end this tax incentive from the beginning of next year, but would create a tax incentive for research and innovation - would "inevitably affect" the national real estate market "as it is an active market segment, especially in high-end residences, which would lose one market segment".

The expert said, however, that such a measure "will not solve the problem of housing for the''Portuguese'." "We are talking about a small number of people per year," he explains. Meanwhile, it has been revealed that the majority Socialist government is studying a transition period for foreigners with pending applications with the Foreigners and Borders Service (SEF).

OE2024: 'The government could clearly have gone further'

This is one of the measures in the OE2024 proposal, which will be debated and voted on in the State Duma on October 30 and 31, with a final vote scheduled for November 29. When asked if the government could have gone further in some of the measures, Jorge Botha does not hesitate and answers: "Of course it could have.

"When we identify a problem, such as housing, and do not act in one of the most important areas to increase''proposals such as the excessive tax burden in the construction industry, it is clear that there was still a lot of work to do in this State Budget,' he says. "We must again learn from the lessons already learned, and everyone remembers that one of the reasons for the success of the regeneration of historic centers, not only in Lisbon but in the whole country, was that for a specific problem a solution was found that clearly contributed to the solution, such as the reduction of VAT on construction from 23% to 6%. With this reduction alone, we could already have made a significant contribution to reducing the cost of housing in Portugal," he concludes.

The Association of Real Estate Consulting and Appraisal Companies (ACAI) is made up of the consulting companies B. Prime, CBRE, Cushman & Wakefield, JLL, Savills and Worx,'''who are responsible for about 95% of commercial real estate properties, providing valuation, consulting and/or brokerage services.

Fred took the plunge into journalism already 20 years ago and became the first idealista/news correspondent in Portugal at the end of 2010. In his activity, he has delved into real estate studies, with a willingness to write about the sector with dedication, energy and precision. And, of course, always with a smile. Always.