Brussels pushes Portugal to raise property tax—here's why investors should pay attention

The European Commission has urged Lisbon to reconsider its municipal property tax (IMI). The objective is clear: to encourage Portuguese homeowners to sell vacant properties and stimulate the housing market. In parallel, the EC recommends temporarily subsidising the most vulnerable households to avert social unrest.

The figures paint a serious picture. Over the past decade, Portuguese property prices have more than doubled, particularly in coastal cities. Demand far outstrips supply—a classic shortage. The EC proposes shifting the tax burden from sales transactions to regular ownership payments, thereby incentivising asset turnover.

On the positive side, investment in social housing has grown in recent years, partly funded by European grants. Yet this remains insufficient to arrest the surge in prices.

Source: Portugal News