# Guatemala residential property tax reform

> Live situation record from CLSTR: https://clstr.news/situations/guatemala-residential-property-tax-reform
> Updated: 2026-08-31T02:49:54.000Z. Sources: 4. Developments: 2.

The Congress of Guatemala approved Decree 18-2026, reforming the Single Property Tax (IUSI) law to establish a zero rate for residential and mixed-use properties. The reform passed with 121 votes in favor and 25 against, though commercial properties remain subject to taxation.

The new tax rate is scheduled to take effect on January 8, 2027. While the legislation aims to reduce the tax burden on homeowners, fiscal experts have expressed concern regarding the impact on municipal finances. Ricardo Barrientos, executive director of the Central American Institute for Fiscal Studies (ICEFI), noted that the reform lacks sufficient technical studies to determine the extent of revenue loss for local governments.

In 2025, IUSI collections totaled Q1,876 million, with 76% of that revenue concentrated in five specific municipalities. Additionally, the decree introduces a limitation preventing local governments from using public services as a mechanism to pressure taxpayers with unpaid debts from prior years.

## Timeline

### 2026-08-31: Guatemala implements zero-rate property tax for residential housing

Guatemala's Decree 18-2026 introduces a zero-rate IUSI property tax for residential use starting January 2027, sparking concerns over municipal revenue stability.

2 sources. https://clstr.news/cluster/guatemala-implements-zero-rate-property-tax-for-residential-housing

### 2026-08-22: Guatemala Congress approves residential property tax exemption

Guatemala's Congress approved Decree 18-2026, exempting residential and mixed-use properties from the Single Property Tax (IUSI), a move with significant implications for municipal finances.

2 sources. https://clstr.news/cluster/guatemala-congress-approves-residential-property-tax-exemption

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Cite as: Guatemala residential property tax reform. CLSTR, https://clstr.news/situations/guatemala-residential-property-tax-reform