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V0142-14 22 January 2014 · SG de Impuestos sobre el Consumo Criterion in force
IVA · servicio mixto de hostelería

21% VAT rate applies to mixed hospitality services with entertainment; 10% if no entertainment is provided

A hospitality federation requested clarification on the VAT rate applicable when establishments offer entertainment (such as stand-up comedy or singers) without charging an admission fee. The DGT clarified that if the entertainment is provided simultaneously with the hospitality service, it constitutes a mixed service subject to the 21% rate, whereas if no entertainment is provided, the 10% rate applies.

The question raised

Applicable tax rate.

The DGT's ruling

Mixed hospitality services, which combine the supply of food or beverages with recreational services (such as musical performances, stand-up comedy, or singers), are taxed at the general rate of 21%. The reduced rate of 10% applies to the supply of food and beverages on days and at times when musical or entertainment services are not provided simultaneously. The presence of background music does not convert the activity into a mixed service.

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