Spain Repeals Housing Decree and Withdraws Associated VAT Changes

Summary 

• Spain’s Congress rejected Royal Decree-Law 26/2026, and the repeal was formally published on 2 October 2026. 

• The repealed decree had proposed applying 10% VAT to specified short-term furnished tourist accommodation and extending reduced rates to qualifying residential renovation work and protected housing. 

• The September VAT changes should therefore not be treated as part of Spain’s continuing legal framework. 

Extended article 

Spain has repealed Royal Decree-Law 26/2026 after the Congress of Deputies rejected the measure. The decree had briefly introduced a broad housing package that included VAT changes affecting short-term and furnished tourist rentals, qualifying renovation and repair work, and officially protected housing. 

The repeal means that the VAT measures announced under the decree do not continue as the applicable legal framework. Businesses that assessed pricing, contracts or system changes based on the short-lived decree should refer back to the VAT rules that remain in force and separately analyse any transactions carried out while the decree was temporarily effective. 

External sources: Review the repeal update

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