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V1996-24 18 September 2024 · SG de Impuestos sobre el Consumo Criterion in force
IVA · distribución de energía eléctrica

Electricity distribution taxed under main operation if provided with supply

The consultant asks whether electricity distribution from a Canary establishment is subject to VAT. The DGT responds that if distribution is provided together with supply, it is a secondary service falling under the regime of goods delivery (supply).

The question raised

Clarification of the binding ruling of October 23, 2023, number V2850-23, regarding whether the distribution of electrical energy carried out by the applicant from the permanent establishment located in the Canary Islands is subject to Value Added Tax.

The DGT's ruling

If the distribution is provided jointly with the supply, it is an ancillary supply and is taxed according to the delivery of goods (Art. 68.Six Law 37/1992). If provided separately, it is considered a transport service. In this case, it shall be taxed if the recipient is a taxable person established in the territory of application, or if the recipient is not a taxable person but the service is used within the territory. It shall not be subject to tax if the recipient is a non-taxable person established outside the Community, the Canary Islands, Ceuta, or Melilla, except in the case of effective use.

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