- September 21, 2023
- Posted by: andorrasolutions
- Category: News Andorra
The Consell General d’Andorra has approved the draft law on the transitional suspension of authorisations for foreign investment in real estate in Andorra. The proposal was presented on 4 September 2023 by the Minister of the Presidency, Economy, Labour and Housing of Andorra, Conxita Marsol, and the vote was held on 7 September 2023, with 23 votes in favour and 3 against.
This suspension arises as a punctual and transitory measure to address the current problem suffered by the country due to the lack of affordable rental housing. Until the new tax is ready and to avoid the effect of attracting potential investors during the regulatory impasse, it was decided to process this bill as a matter of urgency. This measure is also intended to “discourage speculative sales and purchases”.
The reason for implementing this transitional suspension of foreign investment in Andorra is due to the large increase in foreign investment in real estate in the country and to guarantee sustainable growth. Likewise, the economic capacity of this investment in real estate is to revert directly to the State.
During this moratorium period, the government will work to establish a new tax on investment in real estate with foreign capital in Andorra. It is expected to be ready this autumn. The new tax will be used to promote measures to benefit citizens, such as investment in infrastructure, economic diversification projects and increasing the public rental housing stock in Andorra. At the same time, the government will also work on a second tax for foreign investors who disinvest in Andorra before a certain period of time.
At the same time, the government is planning to update the law on foreign investment, which it intends to present during the first quarter of 2024. As explained by the head of government Xavier Espot, “we have opted to adopt the moratorium until the tax to be paid by foreigners who want to invest in real estate is established, but in parallel we are working on a modification of the law through a participatory and plural project”.