The Spanish government has once again updated the maximum coefficients applied to the calculation of urban land gains tax, better known as municipal gains tax. Due to the lack of a state budget for 2026, the government has updated the maximum coefficients used to determine this tax through a royal decree-law.

How are the odds changing and who will be affected?

These new ratios penalize owners who sell a home several years after purchasing it, as they are allegedly doing so for “speculative purposes.” For example, the coefficients increase primarily when ownership rights are transferred in less than a year, after 2–3 years and, especially, after 7–15 years. But there is also a reduction in the coefficients – up to 12.5% ​​when selling after a period of property ownership of 17 years or more.

When will the decree-law come into force?

To enter into force, this decree-law must now be approved by Parliament within a maximum of 30 days, starting from its publication in the Official State Gazette (OGE) on 12/24/2025. If this does not happen, as it already happened a year ago, then the previous coefficients will apply again.

What to consider when selling real estate

• In this regard, in the case of real estate sales, where a higher percentage may be applied, it is necessary to wait for parliamentary approval, since otherwise lower coefficients will apply.
• Conversely, when selling a property that has been owned for over 17 years, you should get the deal done as soon as possible to take advantage of the reduced rates before they are cancelled.

Read more about what expenses and taxes when selling real estate may occur in Spain, as well as what documents needed to sell real estate, read the materials of Alegria Service.

Adjustment of cadastral value

It should be remembered that in order to collect this tax, the decree recognizes the ability of municipal authorities to adjust the cadastral value of land downward by 15%, depending on the degree of its renewal. This ensures that the tax is adapted to the actual situation in the real estate market of each locality.

If you need advice on tax issues or support for real estate transactions, you can use the sections Alegria Service and real estate in Spain – services. Material about IBI tax in Spain.

Municipal property gains tax rates for 2025 and 2026