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A company has requested clarification on whether the transfer of unconsolidated urban land, without a replanning project or commenced urbanisation works, is subject to VAT. The DGT ruled that, as no material physical transformation works have begun, the land retains its rural nature and the transaction is exempt.
This ruling clarifies the distinction between urban land and rural land for VAT purposes, specifically regarding the requirement for physical transformation works to trigger VAT liability on land transfers.
The tax team reviews your specific situation.
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