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VAT 2023 practical manual.

8. Tax rates

• Natural gas, briquettes, pellets and firewood

With effect from January 1, 2023 and valid until December 31, 2023 , the rate of 5 percent of will be applied VAT ##3##on intra-community deliveries, imports and acquisitions of natural gas, briquettes and pellets from biomass and wood for firewood . 

The rate of equivalence surcharge applicable, during the time frame mentioned in the previous paragraph, to deliveries of briquettes and pellets from biomass and to wood for firewood will be 0.62 percent .

• Masks, in vitro diagnostics and Sars Cov-2 vaccines

With effect from January 1, 2023 , the first Additional Provision of Royal Decree-Law 29/2021, of December 21, is modified to establish that:

  • The application of the tax rate of 4 percent VAT to intra-community deliveries, imports and acquisitions of disposable surgical masks referred to in the Agreement of the Interministerial Commission on Drug Prices, of November 12, 2020, provided for in article 7 of Royal Decree-Law 34/2020, of November 17, on urgent measures to support business solvency and the energy sector, and in tax matters, is extended until June 30, 2023 .

  • The application of the tax rate of 0 percent VAT to intra-community deliveries, imports and acquisitions of health products for in vitro diagnosis of SARS-CoV-2 , the vaccines against SARS-CoV-2 authorized by the European Commission, and the provision of related transport, storage and distribution services , as well as for the purposes of the special regime of the equivalence surcharge (which will be 0 percent), is extended until June 30, 2023 .

• Electric power

With effect from July 1, 2022 and valid until December 31, 2023 , the VAT rate of 5 percent will be applied to intra-community deliveries, imports and acquisitions of electrical energy made in favor of:

  • Holders of electricity supply contracts, whose fixed power term is less than or equal to 10 kW , regardless of the supply voltage level and the contracting modality, 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 .

  • Holders of electricity supply contracts who are recipients of the social electricity bonus and have recognized status as severely vulnerable or severely vulnerable at risk of social exclusion , in accordance with the provisions of Royal Decree 897/2017, of October 6.

• Food

With effect from January 1, 2023 and valid until December 31, 2023 :

  • The 5 percent VAT rate will be applied to intra-community deliveries, imports and acquisitions of olive oils and seeds and pasta .

    The rate of the equivalence surcharge applicable to these operations will be 0.62 percent .

    However, the applicable tax rate will be 10 percent as of November 1, 2023 , in the event that the interannual rate of core inflation for the month of September, published in October, is less than 5.5 percent. In this case, the rate of equivalence surcharge applicable to these operations will be 1.4 percent .

  • The 0 percent VAT rate will be applied to intra-community deliveries, imports and acquisitions of the following products:

    • common bread , as well as frozen common bread dough and frozen common bread intended exclusively for the production of common bread, as well as bread-making flours .

    • The following types of milk produced by any animal species: natural, certified, pasteurized, concentrated, skimmed, sterilized, UHT, evaporated and powder.

    • The cheeses and the eggs .

    • The fruits, vegetables, legumes, tubers and cereals , which have the status of natural products.

    The rate of equivalence surcharge applicable to these operations will be 0 percent .

    However, the applicable tax rate will be 4 percent as of November 1, 2023, in the event that the annual rate of underlying inflation for the month of September, published in October, be less than 5.5 percent. In this case, the rate of equivalence surcharge applicable to these operations will be 0.5 percent .

• Feminine hygiene products

With effect from January 1, 2023 , the 10 percent tax rate applicable to pads, tampons, panty liners, condoms and other non-medicinal contraceptives becomes 4 percent .