Earlier this year, the Commission for Economic Affairs and Taxes of the Council of States (WAK-S) discussed the dossier again. There is currently no consensus in sight on key issues such as debt interest deductions, which are to be permitted in future.
Although the majority of the Commission agreed to abolish imputed rental value, they also demanded the complete cancellation of debt interest deductions. According to this proposal, only first-time buyers of residential property would be able to deduct small amounts of mortgage interest and for a limited period. For everyone else, there would be no deduction of debt interest at all, not even for individuals with vacation apartments or owners of rented apartments.
The latest statements of the Federal Council in August 2021 and the responsible committee in the Council of States show opinions still diverge widely. For example, there is no consensus about future tax relief on debt interest or on whether the imputed rental value should also be abolished for vacation properties.
Whether there will be any change to the system remains to be seen. The parliamentary deliberations and a potential referendum could drag on for another two or three years. The future of imputed rental value is therefore still uncertain.