Cabo Verde – Real Estate Taxes Reform: New Tax Codes come into force
07/01/26
In brief
The Real Estate Ownership Tax (“Imposto sobre a Propriedade de Imóveis” or IPI) Code and the Real Estate Transfer Tax (“Imposto sobre a Transmissão de Imóveis” or ITI) Code were approved and published in the Official Gazette.
Both entered into force on 1 January 2026.
In detail
In the context of the reform of property taxation, the Real Estate Ownership (“Imposto Sobre a Propriedade de Imóveis” or IPI) Code was approved and published in the Official Gazette under Law No. 55/X/2025 of 6 June, and the Real Estate Transfer Tax (“Imposto Sobre a Transmissão de Imóveis” or ITI) Code under Law No. 54/X/2025 of 6 June.
Both came into force on 1 January 2026 and introduce significant changes to property taxation, repealing the Single Property Tax Code (“Imposto Único sobre o Património” or IUP).
From the outset, there is a clear separation between taxation on property ownership and other related matters, and taxation on its transfer.
Below are some of the main changes introduced.
Real Estate Ownership Tax (IPI)
Scope
IPI applies to the taxable value of properties located in Cabo Verde and is payable by the owner (or holder of other real rights) of the property as at 31 December of the relevant year.
Taxable value
For IPI purposes, the taxable value of properties is determined by valuation, based on a formula that considers various factors, with specific provisions for hotel units.
Rates
The general IPI rate is set at 0.1%, except for land, which is taxed at 0.15%.
There is an increase in the IPI rate for (i) urban properties with unfinished main façade cladding and (ii) vacant, derelict or degraded urban properties.
Temporary non-liability
Temporary exemptions apply to:
- Properties acquired by credit institutions through acts of lieu in payment, enforcement proceedings, bankruptcy or insolvency;
- Land acquired for construction by companies whose business is building for sale;
- Properties acquired by companies whose business is property sales.
Transitional and special provisions
Transitional safeguard rule: If applying the IPI rate to the amount calculated using the new formula results in a tax increase of more than 10% compared to the amount paid in the previous year, the increase is reduced to that percentage limit. This provision applies for five years from the date the IPI Code enters into force.
Valuation: Until municipalities carry out a general valuation of urban properties within their territory, these will be valued under the IPI Code upon their first transfer, whether for consideration or free of charge, after its entry into force.
Real Estate Transfer Tax (ITI)
Scope
ITI applies to transfers for consideration and free of charge (by death or donation) of ownership rights and their partial forms, on property located in Cabo Verde.
Tax base
As a rule, for transfers for consideration, ITI applies to the taxable value of the property, plus any amount declared by the parties to the transaction if not included in the taxable value.
Rates
- The ITI rate is set at 1%.
- The ITI rate increases to 3% if the seller or buyer benefits from a privileged tax regime, as provided for in the General Tax Code.
Exemptions
ITI exemptions apply to acquisitions of properties by credit institutions through acts of payment in kind or enforcement proceedings brought by those institutions or another creditor, as well as acquisitions in bankruptcy or insolvency proceedings, intended to realise credits arising from loans or guarantees.
Tax benefits provided for in special statutes remain in force, as do those resulting from agreements between the State and any public or private entity or international convention, under the terms of the statutes that authorised them.
© 2026 PwC. This communication is of an informative nature and intended for general purposes only. It does not address any particular person or entity nor does it relate to any specific situation or circumstance. PricewaterhouseCoopers Tax Services TLS, Lda. We will not accept any responsibility arising from reliance on information hereby transmitted, which is not intended to be a substitute for specific professional business advice.
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