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V1720-19 9 July 2019 · SG de Impuestos sobre el Consumo Criterion in force
IVA · entrega de bienes

Paper newspaper subscriptions with digital access classified as a supply of goods

A company has requested a ruling regarding the taxation of distributing newspapers in both physical and digital formats to subscribers in the Canary Islands. The DGT has determined that a paper subscription constitutes a supply of goods, whereas the digital component is a supply of services. If both are offered together, the paper supply is considered the principal element.

The question raised

Taxation of the distribution of the newspaper in both formats to subscribers established in the Canary Islands and, where applicable, the manner in which the Canary Islands General Indirect Tax must be remitted.

The DGT's ruling

The sale of paper subscriptions is considered a supply of goods, whereas a digital subscription is a supply of services by electronic means. If the paper subscription includes access to the digital edition, it constitutes a single transaction classified as a supply of goods, as the digital access is ancillary to the main service. Digital subscriptions to non-entrepreneurs in the Canary Islands shall not be subject to VAT according to the rules of location.

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