Economy, Business And Markets

Empty Houses Now Taxable, Says INTA

Empty Houses Now Taxable, Says INTAEmpty Houses Now Taxable, Says INTA

The head of the Iranian National Tax Administration said Monday henceforth vacant homes would be taxed and the new rules would apply from the fiscal year that started in March.  

For years economists and experts had been pushing governments to declare vacant homes taxable to help ease the mounting pressure on first-time homebuyers and those wanting to lease a dwelling place in visibly prohibitive Tehran property market where sky is the limit.

"According to the law, the collection of taxes from vacant property applies from the beginning of the current fiscal year and taxpayers must mention their empty houses when filling tax returns," Kamal Taghavinejad was quoted as saying by  

According to Clause 77 of the Direct Taxes Act, INTA is also responsible for the collection of construction taxes," he added.

According to the act, residential units in cities with a population of over 100,000 that are identified as "empty residential premises" in the National Property Database are subject to tax after having remained vacant for two years.

Furthermore, empty units will be taxed half the designated rate for the second year. But homeowners will have to pay the full tax from the third year and 1.5 times the amount from the fourth year onward.

The new tax scheme was put in place specifically to discourage investors and people from adopting a ''buy and hold'' approach to residential units -- a sector that has a 38% share in the economy. According to Morteza Tamaddon, former governor general of Tehran Province, there are an estimated 300,000 unoccupied homes in the sprawling metropolis (unofficial figures put the number at 400,000). A large percentage of the empty units are luxury apartments in the upscale districts of Tehran whose owners are looking forward to fatter profits.