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V3122-20 20 October 2020 · SG de Impuestos sobre el Consumo Criterion in force
IVA · tipo impositivo reducido

Water supply works and road resurfacing subject to 21% VAT

A homeowners' association has enquired whether renewing the water network and resurfacing roads can qualify for the reduced 10% VAT rate. The Directorate-General for Taxes (DGT) has ruled that these works do not qualify for the reduced rate and must be taxed at the standard rate.

The question raised

Applicability of the reduced tax rate established in Article 91.One.2.10º of the Value Added Tax Law to the execution of the described works.

The DGT's ruling

Works for the supply and evacuation of water, as well as those for access, streets, and sidewalks, are not considered buildings. As these are exterior repair works that do not form part of residential buildings nor are they annexes to them, the general tax rate of 21% applies.

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