EU: CJEU referral on Portugal’s regime imposing increased property tax rates on real estate held through tax haven structures
Whether regime is compatible with EU law
The Tribunal Arbitral Tributário on October 8, 2025, referred questions to the Court of Justice of the European Union (CJEU) (case C-661/25) regarding the compatibility with EU law of Portugal’s regime imposing increased real estate transfer tax (IMT) and municipal property tax (IMI) rates on Portuguese real estate assets held by companies directly or indirectly controlled by entities established in jurisdictions included on Portugal’s domestic tax haven list.
Background
Under Portuguese tax law, increased rates of IMT and IMI apply to the acquisition and ownership of Portuguese real estate by entities that are directly or indirectly controlled by persons or entities resident in a jurisdiction classified domestically as a tax haven. The Portuguese domestic tax haven list comprises approximately 80 jurisdictions and is independent of the EU list of non-cooperative jurisdictions, although it partially overlaps with both Annex I and Annex II of the EU list.
Read a January 2026 report prepared by KPMG’s EU Tax Centre