Alghero Estates are pleased to report that common sense has prevailed regarding the highly disputed property taxation system enforced by the Sardinian region headed by president Renato Soru. In a ruling upheld on February 12, 2008 by the Italian Constitutional Court. The court deemed the so called Luxury Property Tax on second homes purchased by non Sardinian residents was anti-constitutional and therefore an illegal and unfair tax scheme.

This ruling was predicted back in September 2007 by Alghero Estates in our Real Estate Guide to the Sardinian luxury tax scheme.

The landmark ruling has forced the Regional Government of Sardinia to accept the Tax scheme is illegal and to ensure that property owners who have already paid taxes should be refunded, and that the Luxury property tax for non residents should be abolished with immediate effect.

THE REPLY - The decision of the Constitutional Court to accept the appeal part of the Government against tourist taxes introduced in Sardinia in 2006 translates into a denial of the principle of taxation.

The President of the region of Sardinia, Renato Soru, remarks “In a time of serious budget difficulties of the regional and in the absence of answers from the government then in office, we used - says the Governor - the possibility offered by Article 8 of the Statute to impose taxes on tourism activities, having consulted some of the highest constitutionalists Italians, with the aim, among others, to facilitate a rebalancing between the territories of coastal areas and the centre of Sardinia.

Today the Constitutional Court tells us that this is not possible. Following the conclusion of the dispute with the state for revenue, the loss of this tax will be easily absorbed by the regional budget. But I still regret to note that the region can not use its own tax autonomous capacity against second homes in the coastal strip that is a very important part of our tourism activities and will have a major impact on the consumption of environmental heritage, while generating income in Sardinia, that will not contribute to regional taxation.”