Gift Tax

A local direct tax payable on the gratuitous transfer of property (money, goods, real estate, etc.) between individuals, where such transfer does not constitute inheritance. This tax is administered by the municipalities where the property is located or where the recipient has permanent residence. It is regulated under the Local Taxes and Fees Act. The tax is payable by the recipient of the gift (the donee). Taxable items include real estate (apartments, houses, land), high-value movable property (e.g. cars), money, shares, membership interests, and other gratuitous acquisitions not exempted. Gifts are exempt from tax when made between spouses, direct relatives (e.g. parent and child), siblings, and their children (in some municipalities with zero or reduced rates). The tax rate is determined by the respective municipality and varies depending on the value of the gift, the relationship between the parties, and the municipal council’s regulations.