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V2380-22 ·16 November 2022 ·consulta-vinculante Medium impact
Tax

Establishment of rights of way and compulsory purchase of rural land may be subject to or exempt from VAT

An electric power company has requested a ruling regarding the VAT liability and exemptions applicable to the establishment of rights of way and the compulsory purchase of rural land for the installation of power lines. The Directorate-General for Taxes (DGT) has ruled that both operations are subject to VAT but may benefit from specific exemptions depending on the nature of the land and the holder's business activity.

In 6 key points

How it affects those involved

This ruling clarifies the VAT treatment for energy companies acquiring land rights, highlighting that while these transactions are generally taxable, specific exemptions may apply based on the land's classification and the taxpayer's status.

Lifecycle

2022-11-16PublishedPublished in the BOE
Official text Based on BOE data (boe.es). Information, not advice.

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This analysis is informational only and does not constitute legal advice or create a client-adviser relationship. BM Consulting.
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