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V1630-22 6 July 2022 · SG de Impuestos sobre el Consumo Criterion in force
IVA · servicios prestados por vía electrónica

4% VAT rate applies to digital books; 21% applies to interactive software

A company requested clarification on the VAT rate applicable to the sale of 'SCORM' digital content licenses for training purposes. The Directorate-General for Taxes (DGT) ruled that the rate depends on the nature of the content: an e-book is subject to the 4% reduced rate, whereas interactive products such as videos or simulations are subject to the standard 21% rate.

The question raised

Type of Value Added Tax applicable to the sale of licenses for this type of content.

The DGT's ruling

The reduced rate of 4% applies to the supply of books, newspapers, and magazines by electronic means. For digital content to be considered a book, it must be a work with sufficient length to constitute a volume, with the assignment of an ISBN being an indication of its status. If the content consists of virtual learning material such as videos, animations, or simulations with their own structure and functionality, it is not a book but a product comparable to interactive programs or applications, and therefore shall be taxed at 21%.

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