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V0506-18 22 February 2018 · SG de Impuestos sobre el Consumo Criterion in force
IVA · concesión administrativa

Cleaning and waste management services provided by a concessionaire to a local council are subject to VAT

A company has requested clarification regarding the VAT treatment of a concession contract for street cleaning, waste collection, and green area maintenance services. The DGT has determined that while the administrative concession itself is not a taxable operation, the services provided by the company to the local council are subject to VAT.

The question raised

Treatment for Value Added Tax purposes.

The DGT's ruling

Cleaning services for public roads, parks, gardens, and waste management provided by a concessionaire to the Administration are subject to VAT. The reduced rate of 10% applies to the provision of cleaning services for roads, parks, and gardens, as well as to the collection, transport, or disposal of waste. Regarding contributions for machinery, if the payment forms part of the service price, the 10% rate applies; if the concessionaire acquires the machinery in its own name but on behalf of the Administration, it must invoice at the general rate of 21%.

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