Law   55-A/2012   of   29   October   – published last year as part of the package of measures to combat the financial crisis – made ownership, use or surface rights of residential urban properties with an official taxable value (valor patrimonial  tributário) equal to or greater than EUR 1 million subject to Stamp Duty, calculated  at the rate of 1%.

By reference to the rules of assessment and payment applicable to municipal property tax (Imposto Municipal sobre Imóveis - IMI), the land registration status of the property as at 31 December of any given year is established as the taxable event. The tax is paid in two or three instalments – depending on the value of the assessment – during the following year, as is the case with IMI. This means that, under normal conditions, the new tax  should  only be fully applicable  in  2013,  the  year in which the tax will be assessed by reference to the land registration status of the property as at 31 December 2012, again, as happens with IMI.

However, due to  the  pressing  need to  collect  additional  revenue   to meet the budgetary targets imposed by the Troika for 2012, transitional arrangements have been put into place in order for the new tax to have immediate application.

Under these transitional arrangements, taxpayers had to pay the above tax in a single instalment by 20 December 2012, assessed at a reduced rate on the basis of the land registration status of the property as at 31 October 2012 – the day after the legislation came into force – except as regards the official taxable value  of  the  property  which is that  applicable  as  at  31  December 2011.