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V0903-20 16 April 2020 · SG de Impuestos sobre el Consumo Criterion in force
IVA · dropshipping

Dropshipping activities with shipping from China do not constitute VAT-liable transactions in Spain

A taxpayer has requested clarification regarding the taxation of a dropshipping business where products are shipped directly from China to the end consumer. The Directorate General for Taxes (DGT) has ruled that these sales are not subject to VAT because the transport does not originate in Spain and the end consumer acts as the importer.

The question raised

Taxation of dropshipping activities under Value Added Tax.

The DGT's ruling

The deliveries from the Chinese supplier to the taxpayer are not subject to tax as the goods are not located in the territory of application at the time they are made available. The sale by the taxpayer to the final consumer is also not subject to tax because the transport does not commence in Spanish territory. The taxable event of the importation is carried out by the final consumer, who is the taxable person. Therefore, the activity does not give rise to transactions subject to VAT.

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