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V1186-17 18 May 2017 · SG de Impuestos sobre el Consumo Criterion in force
IVA · tipo impositivo

Electricity supply connections subject to 21% standard VAT rate rather than 10% reduced rate

A housing developer enquired whether connection works carried out by the energy supplier could qualify for the 10% reduced VAT rate. The DGT ruled that these operations do not constitute construction or renovation works for buildings.

The question raised

Applicable tax rate for the aforementioned works carried out by the energy supply company.

The DGT's ruling

The execution of connections for the supply of water, electrical energy, or telephone installations is not considered the execution of works for the construction of buildings. Therefore, they are taxed at the general rate of 21% even if the contract is formalized directly between the developer and the company performing the work.

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