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Controversial housing programme approved without changes

Parliament has reapproved the Mais Habitação program, without making any alterations, with only the affirmative vote of the PS (Socialist Party). This decision comes following a review, subsequent to the veto issued by the President of the Republic.

The approval of Decree 81/XV, which encompasses various legislative changes in the realm of housing, was achieved primarily through the overwhelming majority support of the PS (Socialist Party). The opposing votes came from the PSD (Social Democratic Party), Chega, Liberal Initiative, PCP (Portuguese Communist Party), and Bloco de Esquerda (BE, Left Bloc), with Livre and People-Animals-Nature (PAN) abstaining. This decision reiterates the final global vote on the program that took place in July.

The opposition parties put forth over 320 proposed amendments for consideration during the plenary session, all of which were rejected by the socialist deputies, sometimes with the support of other parliamentary groups.

The Decree of the Assembly of the Republic introduces legislative changes in areas related to renting, local accommodation, vacant properties, and taxes.

Among the most contentious and debated measures are the suspension of the registration of new local accommodations in areas outside low-density territories, the introduction of an extraordinary levy on this business, the enforcement of rental for properties vacant for over two years, and the establishment of a cap on the rental rates for homes already available on the market.

The housing package also encompasses several significant measures, including:

  1. Capital Gains Tax Exemption: Owners who sell their properties to the State will be exempt from capital gains taxation.

  2. End of New Golden Visas: The program will put an end to new golden visas, a popular method for acquiring Portuguese residency through property investment.

  3. Increased Deduction for Dependents: There will be an increase in the deduction for dependents under the Family Property Tax (IMI).

  4. Changes to Property Income Rates: The autonomous rate of property income will undergo modifications.

  5. Tax Exemptions: Owners who withdraw their properties from local accommodations by the end of 2024 will receive tax exemptions.

Deputy Márcia Passos, representing the PSD, pointed out that these measures have caused "social alarm" and have already led to "significant negative effects," including rising rent costs and reduced construction. She accused the government of being "stubbornly isolated" in handling the housing crisis.

On the left, Deputy Mariana Mortágua from BE stressed that the government's program does not effectively address the housing issue and accused the PS of being out of touch with reality. She suggested measures to tackle the crisis, such as implementing rent ceilings based on location and property type, compelling banks to lower mortgage installments, and prohibiting the sale of properties to non-residents.

Despite the veto on the package approved in parliament, the President of the Republic has promulgated a government decree that simplifies housing-related licensing processes. Marcelo Rebelo de Sousa cautioned that he will monitor the compatibility of these changes with building safety and quality. Under this simplification, architectural projects will now be licensed based on designers' terms of responsibility, and public entities will face penalties for delays in providing their opinions.

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