VAT on new construction

Construction VAT applies at a rate of 21% on the purchase of new property (first sale within 2 years of first occupation) and on construction works. For renovations of dwellings over 10 years old, a reduced rate of 6% applies to labor and materials, provided the dwelling is used as a private residence. Demolition-reconstruction has benefited from a reduced rate of 6% nationwide since 2024 (previously limited to 32 cities). When purchasing new property with VAT, registration rights only apply to the land. VAT is deductible for properties used for a VAT-liable professional activity.