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V2045-22 22 September 2022 · SG de Impuestos sobre el Consumo Criterion in force
IVA · exención por exportación

VAT export exemption depends on whether transformation is classified as a service or a supply of goods

A manufacturer of pharmaceutical raw materials seeks clarification on the taxation of sales to non-EU clients who hire a third party to transform the product within Spain. The DGT examines the exporter status and whether the transaction qualifies as an export exemption or an intra-community supply subject to VAT.

The question raised

Taxation of the described operations for Value Added Tax purposes and, where applicable, the determination of who holds the status of exporter.

The DGT's ruling

If the processing works are classified as a provision of services, the supply of raw materials may be exempt due to export if the legal requirements are met. If the works are classified as a supply of goods, the exemption would only apply to the final supply and not to the prior supply of raw materials, which would be an intra-community supply subject to VAT. The classification depends on the importance of the value of the materials provided by each party relative to the total value of the finished product.

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