Andorra’s 2027 budget: no tax rates raised, but tax adjustments

Where does Andorra’s 2027 budget stand?

The Govern filed the budget bill for 2027 with the Consell General, Andorra’s parliament, on 17 September 2026; it was published on 30 September and sent to the Finance Committee. Three parliamentary groups, Concòrdia, the Social Democratic group and Andorra Endavant, have each tabled an amendment to the whole bill asking for it to be sent back to the Govern.

The headline figures: more revenue, with no rise in rates

Expenditure and investment+11.2% compared with 2026

€834.8 million

Revenue+11.5%

€792.5 million

Direct taxes+17%

€300 million

According to the Govern, the rise in revenue comes from the strength of the economy (employment, company profits, transactions) and not from higher rates: the budget is presented as drawn up “without raising taxes, while reducing debt”. Indirect taxes would reach €387 million, up 5.7%. The rates in force remain those presented in our guide to taxes in Andorra.

What would change for individuals

• Main home: the exemption for a capital gain reinvested in a home (IRPF) and the exemption for the first purchase of a home (ITP) would be reserved for taxpayers who are up to date with their tax obligations.
• Purchase without a notarial deed: for an acquisition made by private contract, the date and the price would have to be proven with certainty to be taken into account.
• Landlords: the flat-rate deduction for expenses of 40% of rents could be raised by 10 points for a home let as a main residence, if the rent is less than €9 per m² and does not exceed €1,250 a month; opting for this flat rate is binding for at least three years.
• Non-resident workers: the special regime of non-resident income tax (IRNR) would apply automatically, with no prior formality.

The income tax calculation remains the one detailed in our guide to income tax in Andorra: 0% up to €24,000, then an effective rate of 5% up to €40,000 and 10% above that.

What would change for companies

• Payments on account: an option would allow three corporate income tax payments on account a year, in April, October and December, calculated on the actual results of the first three, nine and eleven months.
• Property sales: the payment on account due on the sale of a property would be set at 3% of the sale price, for companies and sole traders alike.
• Holding companies and branches: under the special regime for holding companies (Article 38), foreign subsidiaries would have to be subject to a comparable tax at a nominal rate of at least half the Andorran rate, i.e. 5% instead of 4% (40% of the rate); the same condition would apply to exempt the profits of branches abroad (Article 21). It is deemed met in a country linked to Andorra by a tax treaty.
• Unpaid debts: arbitration proceedings would be enough to deduct the loss on a doubtful debt.

According to the explanatory memorandum, the new condition of the holding company regime would apply only to financial years beginning on or after 1 January 2028. The two participation exemption regimes are compared in our guide to the holding company in Andorra.

Foreign investors: business premises exempt from IEI

The foreign property investment tax (IEI) already exempts, under certain conditions, the purchase of premises by a foreigner who carries on an activity in them. The bill extends this exemption to Andorran companies at least 50% owned by foreigners, subject to four cumulative conditions: an activity other than property development or property dealing, ownership for at least ten years, premises not intended for housing, and job creation. Housing, on the other hand, remains taxed at 6% or 10%, as explained in our news item on the 6% IEI on property purchases by foreigners.

Tax audits: more information for the tax authorities

The tax administration could request information from third parties in all its procedures, and no longer only in inspection and collection, and would have access to the register of financial accounts for its audits. The bill does not change the automatic exchange of information with France, in place since 2018.

CASS pensions: uprating according to the amount

CASS pensions would be uprated in line with inflation according to their amount: twice the price index up to the minimum wage, the full index up to two minimum wages, a quarter of the index up to three, and no uprating above that. Contributions are presented in our guide to social security contributions in Andorra.