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VAT amendments provided in Law 11/2020, dated 30 December, on the General State Budgets for 2021

On 31 December, Law 11/2020 of 30 December on the General State Budgets for 2021 was published in the BOE, which establishes the following amendments to Law 37/1992:

  1. Location of service provisions: rule of effective use.Article 68 of the General State Budget Law for 2021 establishes that, effective from 1 January 2021 and in force indefinitely, Article 70.Two of the VAT Law shall be amended, as the special rule of effective use for services considered delivered, pursuant to the rules of location, in the Canary Islands, Ceuta and Melilla shall no longer apply.

  2. Tax rate applicable to beverages containing added sweeteners. Article 69 of the General State Budget Law for 2021 establishes that, effective 1 January 2021 and in force indefinitely, Article 91.1.1.1 of the VAT Law shall be amended, increasing the tax rate applicable to soft drinks, juices and carbonated drinks containing added sugars or sweeteners, from 10% to 21%.

  3. Limits for the application of the simplified regime and the special agriculture, livestock and fishing regime Article 70 of the General State Budget Law for 2021 provides that, effective from 1 January 2021 and in force indefinitely, the transitional provision thirteen of the VAT Law shall be amended to extend the limits for the application of the simplified regime and the special agriculture, livestock and fishing regime for 2021.

Ley 11/2020, de 30 de diciembre,

de Presupuestos Generales del Estado para el año 2021