Mallorca holiday lets face 10% VAT under Spain’s plan

Holiday flats on Mallorca face a 10% value added tax (VAT) under a Spanish government plan that would end their current exemption. Spain’s cabinet approved two housing decrees in Madrid on Tuesday, 29 September 2026. The government has asked Congress to hold a special sitting on Friday to approve them.

Why the holiday-let tax fell to 10%

The government had previously proposed a 21% rate. Housing Minister Isabel Rodríguez said the lower figure in the final text came out of negotiations. She added that regional governments would need to follow it up through their tourism rules.

The decrees also aim to stop seasonal lets and room rentals being used to get around protections for people renting their main home.

What the plans mean for tenants

Existing rental contracts due to end before 31 December 2028 would be extended by two years. A separate decree would automatically renew leases on main homes, with exceptions including cases where an owner or family member needs the property.

The plans would extend protection against eviction until 2030 and limit rent adjustments to 2%. Income-based tax breaks for tenants earning up to €30,000 or €33,000 could reach about 1.6 million households, according to tax authority estimates cited by Rodríguez.

None of those changes is assured yet. The government is seeking support from parliamentary groups before Congress considers the decrees.

Topics: Jobs & labour · Housing · Tourism · Politics · Economy

Source: Europa Press / Mallorca.com