As 2025 begins, Spain is bracing for transformative shifts in consumer habits driven by legislative changes in critical sectors such as smoking, housing, and transportation. These changes promise to shape the year ahead and beyond.
One of the most prominent legislative updates in 2025 will be the anticipated approval of the Anti-Tobacco Law. Smoking is the leading cause of preventable mortality and morbidity in Spain and in other developed countries. the government is therefore prioritising this issue.
The World Health Organisation (WHO) estimates that tobacco consumption is responsible for 90% of deaths from lung cancer, 95% from chronic obstructive pulmonary disease, 50% of cardiovascular mortality and 30% from any type of cancer. In addition, environmental tobacco smoke is a cause of mortality, illness or disability due to passive or involuntary consumption.
Therefore, this reform seeks to impose stricter restrictions on smoking, particularly in public spaces. A significant proposal under this law is the prohibition of smoking on outdoor terraces at bars and restaurants. This initiative is specifically aimed at curbing smoking among younger generations.
Additional restrictions include banning smoking in bus shelters, train platforms, football stadiums, and areas near playgrounds and hospitals. While the government insists that self-regulation by businesses has proven ineffective, opposition parties such as the Partido Popular stand by the hospitality sector’s autonomy. To move forward, the government must secure sufficient support in Congress.
Affordability of housing under the microscope
Housing remains a pressing issue in Spain, with accessibility challenges continuing into the new year. The economic climate is shifting as interest rates decline, making it easier for individuals to secure mortgages and driving more people towards home ownership. However, experts like Jordi Fábrega stress that the core issue lies in the limited housing supply, a problem unlikely to see immediate resolution.
For renters, the introduction of a monthly price index in January represents a significant policy shift. This index, published alongside inflation data, caps annual rent increases to the rate of inflation unless otherwise agreed upon by landlords and tenants. By providing a benchmark for rental adjustments, the measure aims to balance tenant protection with property owner interests.
Public transport discounts and incentives
In the transportation sector, public transit users will continue to benefit from substantial discounts through June. The current system, introduced in 2022 to help households cope with rising costs, was due to expire on December 31. Notably, municipalities now have the option to extend these reductions to public bicycle rental schemes, a move designed to encourage sustainable urban mobility. From July, children under 15 will enjoy free access to public transport, and young people will see a 15% discount on season tickets.
For frequent travellers, fare reductions ranging from 40% to 70% will apply to various modes of transport, depending on usage. These incentives highlight Spain’s commitment to fostering greener and more affordable commuting options.
Price hikes across essentials, energy, and telecoms
Apart from the above-mentioned changes in consumer trends for 2025, Spanish households brace for a wave of price increases impacting everyday essentials, energy, and services. Key changes include:
- Food: Reduced VAT rates on staples like olive oil, bread, and milk will end, doubling the rate from 2% to 4%, with pasta and seed oils seeing a rise to 10%. A rare reprieve comes with fermented milk products, such as yoghurt, dropping to 4%. Olive oil prices, however, may ease as production costs fall.
- Energy: Electricity VAT returns to 21%, with a 39% increase in fixed charges. Regulated electricity fees may drop by 4.4%, but natural gas tariffs will rise sharply, along with a near-10% hike in butane prices.
- Telecoms: Providers like Movistar, Vodafone, and Orange are raising prices by 3–5%.
Other costs won’t be spared: postal services, highway tolls, and private health insurance premiums are set to rise, and new taxes will target e-cigarettes and vapes. For many, it marks a challenging financial start to the new year.