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Direct Management: DGT doctrinal evolution

How the DGT's position on this topic has evolved, and the rulings it rests on.

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How the DGT's position has evolved

Refined position High confidence 8 rulings · 2014–2026

Current position

The nature of the consideration depends on who assumes the management, collection, and direct relationship with the users. If the commercial company assumes the risk and the relationship with the user, the consideration is a public non-taxable patrimonial provision subject to IVA (Value Added Tax). If the company is a mere instrument and the City Council manages the collection and the relationship with the user, the consideration has the nature of a fee and is not subject to the tax.

The DGT has moved from considering that companies 100% owned act always as organs of direct management (V0679-14), to establishing a criterion based on the reality of management and the assumption of risks (V2289-22). The current position distinguishes between management as a mere instrument of the public entity and management with operational autonomy and a direct relationship with the user (V0418-26).

Turning points

  1. V2289-22

    Introduces the criterion of the real and effective management by the City Council to determine the nature of a fee. If the City Council assumes the management and collection, the provision is not subject to IVA.

  2. V0418-26

    Specifies that the assumption of the activity risk and the direct relationship with users by the commercial company converts the consideration into a public non-taxable patrimonial provision subject to IVA.

Analysis based on 7 of 8 rulings with a stated position. Updated 2 October 2026.

Rulings on this topic

8

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