Key takeaways
- Essential food VAT cuts: Basic food items like bread, milk, cheese, eggs, fruits, and vegetables now have a 0% VAT rate, while pasta and olive oil are reduced to 5%.
- Lower VAT on essentials: Feminine hygiene products and non-medicinal contraceptives now carry a reduced 4% VAT rate.
- Energy relief measures: VAT on electricity, gas, and biomass fuels has been lowered to 5% until December 31, 2023, to help offset inflation.
Due to continuing economic challenges, the Spanish government has implemented a number of VAT reductions this year. The Spanish VAT rate changes for 2023 are:
VAT on food
The Spanish Government announced on December 27th, 2022, that the applicable VAT rates for basic foodstuffs would be temporarily reduced in 2023. The following changes for VAT on food now apply:
A 4% to 0% reduction of VAT on food for:
Certain types of bread, including frozen bread dough and frozen bread intended exclusively for making bread, as well as bread flours.
Animal milk in the form of natural, certified, pasteurized, concentrated, skimmed, sterilized, UHT, evaporated, and powdered.
Cheese and eggs.
Cereals, fruits, vegetables, legumes, and tubers.
A 10% to 5% reduction of VAT on food for:
Pasta, and also olive and seed oils.
VAT on feminine hygiene products and non-medicinal contraceptives
As of January 1, 2023, feminine hygiene products and non-medicinal contraceptives, including condoms, now have a VAT rate of 4%, reduced from 10%.
VAT on electricity and gas
In an effort to combat inflation, the Spanish government has reduced the VAT on electricity supplies, provided they meet certain conditions. The VAT rate will now be 5%, reduced from 10%.
There’s also a VAT reduction in place from 10% to 5% for natural gas, briquettes and pellets from biomass, and wood for firewood.
The reduction of VAT on gas and electricity will remain in place until December 31, 2023.
Frequently asked questions
What are the new Spanish VAT rates for food in 2023?
In 2023, Spain temporarily reduced VAT on essential food items to help consumers cope with inflation. The VAT rate dropped from 4% to 0% for staples like bread, milk, cheese, eggs, fruits, and vegetables, while pasta and olive oil saw a reduction from 10% to 5%.
How has Spain changed VAT rates on electricity, gas, and hygiene products?
From January 1, 2023, the VAT on electricity and gas was reduced from 10% to 5%, and feminine hygiene products and non-medicinal contraceptives dropped from 10% to 4%. These reductions will remain in effect until December 31, 2023.
