Spain drops tax on new builds by half

BOLSTERING GROWTH: Spain lowered taxes on new home purchases while approving cuts to health spending in a bid to convince investors the country can bolster economic growth and reduce its budget deficit.

Value-added tax on purchases of new homes will be cut to 4 per cent from 8 per cent until the end of the year, said development minister Jose Blanco, whose ministry estimates there are 700,000 unsold homes left over from the housing boom.