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V3308-15 27 October 2015 · SG de Impuestos sobre el Consumo Criterion in force
IVA · sujeción

The sale of recyclable waste by a City Council is subject to VAT, but waste management through fees is not

A City Council inquires regarding the VAT liability of waste management and the sale thereof. The DGT determines that integrated waste management through fees is not subject to the tax, but the sale of recyclable waste is.

The question raised

Question raised 1. VAT liability. 2. Right of deduction.

The DGT's ruling

Waste management services provided by a Public Administration without consideration or through fees are not subject to VAT pursuant to Article 7.8 of Law 37/1992. However, the sale of recyclable waste constitutes a transaction subject to the tax. For dual entities, input tax on goods and services intended exclusively for non-taxable transactions is not deductible, but a reasonable apportionment method may be applied to expenses intended simultaneously for both taxable and non-taxable transactions.

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