Spain is mulling a 100% tax on homes bought by non-EU buyers as a potential solution to the ongoing housing crisis in the country. Property taxes are a significant revenue stream for many European nations, so this proposal has stirred up quite a bit of discussion.
As noted by the European Commission, property taxes range vastly across the EU, comprising just 0.3% of GDP in places like the Czech Republic and Estonia, while France clocks in at a high of 3.7%. The overall EU average sits around 1.9%.
This raises a few questions: How much property tax revenue does the government generate across Europe? Can property tax contribute significantly to total tax income? And what proportion of GDP does property tax represent?
What share does property tax constitute?
In the European Union, property taxes contribute to GDP, with France leading at 3.7%, while the Czech Republic and Estonia both sit at the bottom with 0.3%. When you consider the UK and Turkey, using OECD data, the UK actually has a slightly higher percentage than France, both hovering around 3.7%.
Belgium also surpasses the 3% mark at 3.2%. Spain ranks fifth with 2.5%, followed closely by Greece at 2.7%.
Other nations with property tax shares above 2% include Iceland, Luxembourg, Denmark, Switzerland, Italy, and Portugal. In fact, nearly half of the 32 countries surveyed report property taxes contributing less than 1% of GDP, with Slovakia, Lithuania, Estonia, and the Czech Republic seeing numbers below 0.5%.
Among the largest EU economies, Germany is significantly lower, with property taxes making up just 1% of its GDP. Italy comes in fourth at 2.1%, trailing behind France and the UK.
The data suggests that Northwestern Europe tends to collect a larger share of GDP through property taxes, whereas Eastern Europe and the Baltic states show a lower representation. Southern European countries have a more varied landscape, with some on the higher side.
The OECD defines property taxes as taxes related to the usage, ownership, or transfer of property, including taxes on immobilized assets, inheritance, and capital transactions.
What about the revenue from property tax?
This year, the UK led in property tax revenue, bringing in 115 billion euros (£100 billion), followed by France at 100 billion euros. These two countries dominate property tax collections, with Italy in third place at 45.3 billion euros.
Germany and Spain follow, with property tax revenues reaching 41.4 billion euros and 36.8 billion euros, respectively. The total for the EU amounts to 318.8 billion euros.
Belgium (18.8 billion euros), Switzerland (17.9 billion euros), the Netherlands (14.4 billion euros), and Poland (10.7 billion euros) also generated over 10 billion euros in property tax revenue this year.
In ten EU nations, property tax revenues fell below 1 billion euros, with Estonia generating around 110 million euros.
Property tax as part of gross tax
The contribution of property taxes to total tax revenue varies widely across Europe. In 2023, the percentage ranged from 0.8% in Estonia and the Czech Republic to 8.4% in France, hitting an EU average of 4.7%.
Besides France, other notable countries include Belgium (7.4%), Greece (7%), Spain (6.7%), Portugal (5.9%), Luxembourg (5.7%), Italy (5.1%), and Denmark (5.1%), all above the 5% mark.
In contrast, Germany’s property taxes make up only 2.5% of total tax revenue.
Real Estate Transfer Tax Stocks across Europe
Real estate transfer tax, expressed as a GDP share, highlights how vital real estate transactions are as a government revenue source in certain nations. This tax typically applies to financial dealings like buying, selling, and stamp duties.
According to the OECD, Italy had a real estate transfer tax share of 1% of GDP in 2023, followed by Belgium, Portugal, and Spain at 0.8% each. France’s share stood at 0.7%, while the UK and Germany reported 0.6% and 0.3%, respectively.
Spain’s proposal for a 100% tax on non-EU homebuyers has sparked significant conversation across Europe. During a recent hearing in May 2025 at the European Parliament, economist Jose Garcia Montalvo from Pompeu Fabra University pointed out that adjusting housing tax policies alone might not effectively tackle the underlying housing market issues.
He argued, “Changes in policy and the mismatch between tax measures and housing supply can lead to unpredictable market reactions, impacting affordability.” Meanwhile, Diana Hourani from the OECD highlighted that enhancing efficiency, equity, and profitability in housing taxes could potentially alleviate upward pressure on home prices.
