Real Property Taxes in Europe

August 6, 2020

Early property taxes, which were first implemented in feudal times, were levied primarily against land. Hence, property tax was paid mostly by those that worked as farmers. In modern times, property tax is also levied against assets like real estate. The tax is paid on a recurrent basis on property owned by individuals or legal entities.

real property taxes in Europe, European property tax rankings, property tax collections as a percent of the private capital stock in 2019

High property taxes levied not only on land but also on buildings and structures can discourage investment because they disincentivise investing in infrastructure, which businesses would have to pay additional tax on. For this reason, it may also influence business location decisions away from places with high property tax.

Nineteen of the 27 countries covered allow businesses to deduct property or land tax from corporate income, which mitigates the tax burden of the tax and encourages businesses to invest.

Luxembourg has the lowest property tax as a share of private capital stock, at 0.05 percent. Switzerland has the second-lowest share, at 0.08 percent, followed by the Czech Republic and Austria, both at 0.09 percent. The highest property taxes as a share of the private capital stock occur in the United Kingdom (1.93 percent), France (1.25 percent), and Greece (1.09 percent).

Estonia is the only country in this map which taxes only land, meaning that its real property tax is the most efficient.

Real Property Taxes in European OECD Countries, as of 2018
Country Property Tax as Share of Private Capital Stock Real Property or Land Tax Real Property or Land Taxes Deductible from Corporate Income Tax

Austria (AT)

0.09% Tax on Real Property No

Belgium (BE)

0.55% Tax on Real Property (a) Yes

Czech Republic (CZ)

0.09% Tax on Real Property Yes

Denmark (DK)

0.71% Tax on Real Property Yes

Estonia (EE)

0.13% Land Tax No

Finland (FI)

0.36% Tax on Real Property Yes

France (FR)

1.25% Tax on Real Property Yes

Germany (DE)

0.20% Tax on Real Property Yes

Greece (GR)

1.09% Tax on Real Property No

Hungary (HU)

0.29% Tax on Real Property No

Iceland (IS)

1.02% Tax on Real Property No

Ireland (IE)

0.37% Tax on Real Property Yes

Italy (IT)

0.58% Tax on Real Property No

Latvia (LV)

0.41% Tax on Real Property Yes

Lithuania (LT)

0.20% Tax on Real Property Yes

Luxembourg (LU)

0.05% Tax on Real Property Yes

Netherlands (NL)

0.53% Tax on Real Property Yes

Norway (NO)

0.23% Tax on Real Property Yes

Poland (PL)

0.91% Tax on Real Property Yes

Portugal (PT)

0.43% Tax on Real Property Yes

Slovak Republic (SK)

0.22% Tax on Real Property Yes

Slovenia (SI)

0.26% Tax on Real Property No

Spain (ES)

0.52% Tax on Real Property No

Sweden (SE)

0.35% Tax on Real Property Yes

Switzerland (CH)

0.08% Tax on Real Property Yes

Turkey (TR)

0.13% Tax on Real Property Yes

United Kingdom (GB)

1.93% Tax on Real Property Yes

Note: (a) Tax on the imputed rent of properties. Applies to machinery.

Source: Calculations for “Property Tax as Share of Private Capital Stock” are based on 2018 data from OECD, “Global Revenue Statistics Database: 4100 Recurrent taxes on immovable property,” last updated July 2020, https://stats.oecd.org/Index.aspx?DataSetCode=RS_GBL; and IMF, “Investment and Capital Stock Dataset: Private capital stock (current cost),” https://www.imf.org/external/np/fad/publicinvestment/#5. For the type of property tax and whether it is deductible, see PwC, “Worldwide Tax Summaries,” https://taxsummaries.pwc.com/ (2020 data).

Was this page helpful to you?

No

Thank You!

The Tax Foundation works hard to provide insightful tax policy analysis. Our work depends on support from members of the public like you. Would you consider contributing to our work?

Contribute to the Tax Foundation

Related Articles

A property tax is primarily levied on immovable property like land and buildings, as well as on tangible personal property that is movable, like vehicles and equipment. Property taxes are the single largest source of state and local revenue in the U.S. and help fund schools, roads, police, and other services.

A corporate income tax (CIT) is levied by federal and state governments on business profits. Many companies are not subject to the CIT because they are taxed as pass-through businesses, with income reportable under the individual income tax.