What VAT rates are there in Spain?
In Spain, there are different rates of Value Added Tax (VAT), depending on the type of good or service being considered. The current tax rates are as follows:
VAT rates in Spain
Value added tax is a tax that is added to their prices by companies and self-employed people along the market chain. These companies must pay to the tax authorities the vat they collect and can deduct (under certain rules) the vat they pay.
At the end of the chain, the one who pays the vat is the final customer, the one who is not a businessman or self-employed, who does not carry out an activity and cannot deduct the vat.
The different VAT rates are determined by the necessity and/or urgency of a product or service.
More need less VAT, less need more VAT (although one should also add the need for revenue collection or political interests of the government).
The tax rate applicable to each transaction is that in force at the time of accrual:
- 21%: general rate;
- 10%: reduced rate;
- 4%: super-reduced rate;
- 0%.
Precisions
1) As a consequence of the health emergency created by COVID-19, a 0% VAT rate was established for domestic deliveries, imports and intra-Community acquisitions of goods necessary to combat its effects (health material), whose recipients were public entities, non-profit organisations and hospitals (RDL 15/2020 art.8 and annex).
Measure extended first until 30-6-2022 and then until 30-6-2023.
2) With effect from 24-12-2020 and until 31-12-2022, the 0% rate applies to supplies of goods and services related to in vitro diagnostics and COVID-19 vaccines. The application of this tax rate has been extended until 30-6-2023.
General VAT rate at 21% in Spain
The scope of application of the general rate extends to all transactions that are not taxed at the reduced or super-reduced rate.
Details
With effect from 1-1-2024, a rate of 10% shall apply to the following supplies, imports and intra-Community acquisitions:
Until 31-12-2024 , of electrical energy carried out in favour of holders of electricity supply contracts:
whose contracted power (fixed power term) is less than or equal to 10 kW, regardless of the voltage level of the supply and the type of contract, when the arithmetic average price of the daily market corresponding to the last calendar month prior to the last day of the billing period has exceeded 45 €/MWh; or
recipients of the social voucher for electricity who are recognised as severely vulnerable or severely vulnerable at risk of social exclusion, in accordance with RD 897/2017.
Until 31-3-2024, for natural gas.
Until 30-6-2024, briquettes and pellets from biomass and wood for firewood.
In relation to this type of operations, the 5% rate has been in force until 31-12-2023.
Reduced VAT rate of 10% in Spain
For the application of the reduced rate it is necessary to distinguish between:
- supplies of goods;
- the supply of services.
VAT on sales of goods in Spain
The reduced rate of 10% applies to the following supplies:
- foodstuffs which are likely to be normally and properly used for human or
- animal nutrition and for the production thereof
- water
- goods for agricultural, forestry or stockbreeding use
- medicines for veterinary use
- medical appliances and equipment
- buildings, dwellings, garages and annexes
- flowers and live plants
- works of art, antiques and collectors’ items
- delivery of prescription spectacle frames
Deliveries, intra-Community acquisitions or imports of beverages containing added sweeteners, both natural and sweetening additives, are taxed at the general rate of 21%.
However, the reduced rate of 10% continues to apply to beverages qualified as infant milks and beverages considered as food supplements for special dietary needs.
With effect from 29-12-2023, the application of the 5% rate on the delivery, importation and intra-Community acquisition of (RDL 20/2022 art.72 redacc RDL 8/2023) is extended until 30-6-2024 (previously until 31-12-2023):
olive and seed oils; and
pasta.
The equivalence surcharge to be applied to these articles is 0.62%.
Details
The CJEU ruling 17-1-13, case C-360/11, known as the “medical devices” ruling, determined the modification of the tax rates for these products. Only those products which, due to their objective characteristics, are designed to alleviate or treat physical, mental, intellectual or sensory deficiencies, and whose list is included in the LIVA annex aptdo.8º, will continue to be taxed at a reduced rate.
The list of products listed in the LIVA annex apt. 8 incorporates products intended exclusively for people with disabilities, such as devices designed for the personal and exclusive use of people with visual and hearing impairment; with others, where a mixed use of those products may result, although with a clear and objective utility for people with disabilities.
VAT on the supply of services in Spain
The reduced rate of 10% applies to:
- Services consisting of the transport of passengers and their luggage;
- Hotel, camping and spa services and the supply of food and beverages;
- The leasing of dwellings with an option to purchase;
- Social work;
- agricultural, forestry and stockbreeding activities;
- Cleaning of public roads, parks and public gardens;
- collection, storage and transport of waste;
- cultural events, shows and sports services, trade fairs and exhibitions;
- admission to libraries, archives and documentation centres, as well as visits
- to museums, art galleries and art galleries;
- admission to live cultural events, including theatre, circus and bullfighting
- events;
- Cinemas tickets ;
- services rendered by performers, artists, directors and technicians who are
- natural persons, to producers of cinematographic films to be shown in
- theatres and to organisers of theatrical and musical works;
- the use of immovable property by turns;
- amateur sporting events;
- exhibitions and trade fairs;
- renovation and repair work carried out on buildings or parts of buildings
- used as dwellings.
It is required that the recipient is a natural person and does not act as a businessman or professional and uses the dwelling to which the works refer for his own private use, that the construction or renovation of the dwelling to which the works refer has been completed at least 2 years before the works are started and that the person carrying out the works does not provide materials for their execution or, if he does provide them, their cost does not exceed 40% of the taxable base of the operation.
The real estate construction sector is
Construction works, with or without the supply of materials, which have as their object:
- the construction or refurbishment of buildings or parts thereof, mainly intended for dwellings, including premises, annexes, garages, installations and complementary services located therein, which are the result of contracts entered into directly between the developer and the contractor. Buildings in which at least 50% of the floor area is intended for residential use are considered to be primarily for residential use;
- the construction of garages complementary to the aforementioned buildings, which are the result of contracts entered into directly between the communities of owners of such buildings and the contractor, provided that they are built on land or premises which are common elements of the communities and that the number of spaces to be allocated to each owner does not exceed 2;
- sales with installation of kitchen and bathroom cabinets and built-in wardrobes for buildings whose construction is taxed at the reduced rate, i.e. which are made as a result of contracts entered into with the developer of the construction or renovation of the buildings.
Super-reduced VAT rate of 4%.
The following supplies, AIB and imports of goods and services are taxed at the super-reduced rate of 4%:
- foodstuffs;
- books, newspapers and magazines (also in electronic format);
- school supplies;
- pharmaceutical specialities;
- prostheses, orthoses and implants for persons with disabilities;
- vehicles for people with disabilities;
- subsidised housing and housing acquired by entities dedicated to renting;
- leasing with an option to purchase subsidised housing;
- dependency services.
- Tele-assistance, home help, day and night centre and residential care services, provided that they are provided by means of agreed terms or by means of prices derived from administrative tenders awarded to provider companies, or as a consequence of an economic benefit linked to such services that covers more than 10% of their price in application, in both cases, of the provisions of the Law for the Promotion of Personal Autonomy and Care for Dependent Persons (L 39/2006);
The VAT equivalence surcharge
The taxable amount of the equivalence surcharge is the same as that resulting from the VAT on the transaction.
The applicable rates are:
- 5.2%, as a general rule, for the supply or importation of goods taxed at the general rate of VAT
- 1.4% for the supply or importation of goods taxed at the reduced rate of VAT
- 0.62% for the supply of goods taxed at the rate of 5%.
- 0.5% for supplies of goods subject to the super-reduced rate of taxation
- 1.75% for supplies of goods subject to excise duty on tobacco products.
- 0% for the supply of certain foodstuffs and medical devices for the in vitro diagnosis of COVID-19 and the supply of vaccines.
