Foreign investors could look elsewhere as Italy's taxes rise

International investors could look to the traditional locations in Europe of Spain and France and turn their back on the Italian property market.

The government is reported to be ready to push through a proposal that would see the rate of real estate deals tax rise to around six or seven per cent, much higher than the European-wide average of 3.3 per cent.

"This new tax puts Italy in a bad position for international investors. They won't invest in Italy," an analyst told Forbes.

The tax will comprise of the addition of a four per cent transfer tax to the currently existing two to three per cent of financing the VAT.

If the government manages to call a vote before the parliamentary recess at the end of the week, the tax could be in place and functioning by Friday.

The UK currently has what would become the second highest rate of real estate deals tax, at 4.5 per cent. With this latest news from Italy, many potential overseas investors could focus their attention to Italy's neighbours to get a better tax break.

Considering Spanish property? Then keep up to date with the latest news and other information on homesgofast.com.

02/08/2006

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