As foreseen in article 102 of the Directive 2006/112/EC of the Council, of 28 November 2006, on the common system of value added tax (hereinafter, VAT Directive) the Kingdom of Spain formally communicated to the European Commission on 22nd June 2021 its intention to introduce in the national VAT legislation a provisional measure consisting of the application of a reduced rate of 10% to certain supplies of electricity.
The European Commission considered appropriate launching the written procedure on 25 June 2021, the same being finalised by 15 of July without remarks from the Member States. The Commission formally acknowledged the communication by 16 of July throughout the document WP1017.
Considering that the forward markets indicate that the situation of unusually high electricity prices will continue during the first four months of 2022 and with the aim of reducing the electricity bill of domestic consumers and guaranteeing its supply to vulnerable consumers at risk of energy poverty, it is necessary to temporarily extend the exceptional measures adopted in July 2021 until April 30, 2022.
In the awareness the communication made in July 2022 was referred to a measure of temporary character, with expiring effects by 31 of December 2021, Spain considers necessary the extension of such measure for 4 extra months from 1 January 2022.
Source WP 1031 – ES consultation Reduced rate for electricity
See also
- EU VAT Committee: WP 1017 Spain – Application of a reduced VAT rate to certain supplies of electricity
- ECJ Cases C-384/01 (Commission vs. France) – VAT reduced rates lower than the general rate can be admitted if it does not vulnerate the principle of neutral fiscality
