7

The bill, which has seen several revisions since the first draft was floated by the Finance Ministry in June, is to be rushed through parliament.

The bill sets the tax rate for residential housing properties at 0.15%, while non-residential ones (where the owner or co-owner is not registered to reside permanently, or which is not rented out) will be taxed at 0.5%.

A surcharge of 0.25 percentage points would be imposed on housing units whose value exceeds EUR 500,000.

A higher tax rate of 0.75% would also apply to business and industrial real-estate, except for energy facilities, which would be taxed at 0.4%.

Farming buildings would be taxed at 0.3% and a 0.5% rate would be imposed on other buildings - public ones, cultural monuments, secular buildings.

A tax rate of 0.15% is proposed for farmland, 0.07% for forestland, 0.75% for business or industrial plots, 0.4% for land for energy purposes and 0.5% for building land.

The tax for farmland and forestland for 2014 will not be higher than 25 euros per hectare of farmland and 10 euros per hectare of forestland.

As of 2017 municipalities would be allowed to determine the criteria for reduced or lowered tax rates (such as depending on the location, status of real estate or its purpose). The rates could change up to 2.5-times for all real estate except for illegal buildings, farmland and forestland.

The buildings that had been found illegal through a decision by an inspection authority that has become final but has not been executed yet would be liable to triple the relevant tax rate.

The tax base would be the generalised market value of real estate as listed in the real-estate registry on 1 January for the year for which the tax is paid.

The indexed values of real estate are expected to be made accessible to the public next week, according to the Mapping and Surveying Authority.

Real-estate tax would not be levied on properties owned by foreign countries that are intended as diplomatic offices or representative offices of international organisations or EU institutions.

Exempt would be properties that are considered as public good - except for waters used for business, industrial or energy purposes - as well as infertile land.

The tax, which would replace several existing taxes and fees, would be introduced in 2014 and the Finance Ministry expects to net EUR 205m in budget receipts.

During the three-year transitional period (2014-2016) the tax would be levied at rates as set in the bill and the overall proceeds would go to the national budget.

Municipalities would be allotted the same sum they raised in fees for the use of building land in 2012, reduced by the fees collected for the maintenance of forestry roads.

After the end of the transitional period, the proceeds would be split 50:50 between the state and municipalities. The municipalities would have to remit its share of the tax on forestland to a special account and allocated it for maintenance of forestry roads.

The Mapping and Surveying Authority will notify all liable property owners of the generalised market value, along with informative tax rate and calculation of the real estate tax by 1 February 2014.

The tax for 2014 will be assessed based on data upgraded by the owners in the real estate registry by 1 April 2014 or until the tax assessment is issued. The latter will be issued by 31 May in 2014, and by 31 March in the following years.