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A Communal Woods Association (Comunidad de Montes Vecinal de Mano) has enquired whether it can deduct VAT on road and water infrastructure works for land it intends to lease to slate extraction companies. The Directorate General for Taxes (DGT) has ruled that, as the lease is for the installation of elements related to business activity, the transaction is subject to VAT rather than exempt, thereby allowing the deduction of the VAT incurred.
The tax team reviews your specific situation.
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