The (New) Municipal Property Tax Surcharge - The Real Estate Fortune Tax

The 2017 State Budget Law, approved last week by a final overall vote of the Portuguese Parliament, confirms the entry into force, as from 1 January 2017, of the municipal property tax surcharge (adicional ao Imposto Municipal sobre Imóveis – “AIMI”).

This surcharge replaces stamp duty (item 28) on residential urban properties or land for construction with a taxable value (Valor Patrimonial Tributário – “VPT”) above EUR 1 million. The taxable person responsible for payment of the surcharge will be any individual or legal entity that appears in the land tax register on 1 January of each year as the owner of a property located in Portugal classified as “residential” or “land for construction”, or the persons who are registered as having use and enjoyment or surface rights over the property. For these purposes, legal entities include any structures or centres of collective interests without legal personality, and any undivided estates of deceased persons).