The European Commission warned Spain on April 29 that it is violating the free movement of capital by taxing non-resident taxpayers on properties used as their primary residence in Spain. It will refer the case to the EU's Court of Justice if Spain does not take action within two months.
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According to Brussels, Spanish regulations require foreign citizens to pay an imputed income tax on their second homes of 2% of the cadastral value, while taxpayers resident in Spain are exempt from this charge.
The Commission argues that taxing non‑resident owners on homes used as their main residence undermines both the free movement of workers and the free movement of capital within the EU.
Brussels had already warned Spain about this discriminatory tax treatment in 2021 and again in 2024 – issuing formal ultimatums on both occasions. In its official responses and technical dialogues over that period, however, the Spanish authorities maintained that national tax legislation complies with EU law.
In June 2025, the Commission launched infringement proceedings against Spain. With no progress made during the initial phase, EU services have now moved to issue a reasoned opinion, granting Madrid a fresh two‑month deadline to correct the identified irregularities.
If this renewed dialogue fails to deliver results, the European Commission has made clear that it may advance to the third and final stage of the procedure – referring the case to the Court of Justice of the European Union.
