Among the main tax measures, the 0% VAT rate applicable to deliveries, imports and intra-community acquisitions of goods necessary to combat the effects of COVID-19 is extended until October 31; a specific tax regime is established applicable to the final of the "UEFA Women's Champions League 2020" and deeds formalizing the moratoria of mortgage loans and credits and of leases, loans, leasing and renting without mortgage guarantee that occur in application of the mortgage moratoria for the tourism sector and for the public transport sector of goods and discretionary passenger transport by bus are declared exempt from Stamp Duty.
In the Official State Gazette (BOE) of August 5, 2020, Royal Decree-Law 27/2020, of August 4, on financial measures of an extraordinary and urgent nature, applicable to local entities (RDL 27/2020), was published, with entry into force from August 5, except for some exceptions.
This regulation reflects the agreement reached between the Ministry of Finance and the Spanish Federation of Municipalities and Provinces (FEMP), which will allow the mobilization of up to 5 billion euros for municipalities with treasury surpluses and allocate them to programs for local care, mobility, housing, sustainable development and promotion of cultural activity.
Regarding the tax field, we can highlight the following measures:
- AMENDMENT TO THE VALUE ADDED TAX LAW
0% tax rate on the delivery, import and intra-community acquisition of medical supplies
The fourth additional provision of Royal Decree-Law 27/2020, effective from April 23, 2020:
- It maintains until October 31, 2020 the application of the zero percent tax rate to domestic deliveries, imports and intra-community acquisitions of medical material to combat COVID-19, whose recipients are public entities, non-profits and hospital centers.
- Update the list of goods to which this measure applies.
Businesses that have charged or paid VAT for transactions carried out before August 5th to which Royal Decree-Law 27/2020 applies the zero rate, will rectify the tax in accordance with Article 89 of the VAT Law.
Please note that these transactions will be documented on the invoice as exempt transactions.
- «UEFA WOMEN'S CHAMPIONS LEAGUE 2020»
The third additional provision of Royal Decree-Law 27/2020 establishes a specific tax regime applicable to the final of the 2020 UEFA Women's Champions League, to be held in Bilbao in August 2020. This regime applies to the organizing entity, the participating teams, and individuals providing services to the organizing entity or the participating teams. It also establishes the customs and tax regime applicable to goods imported for the development and holding of the final, as well as a specific VAT regime.
- A) Regarding Corporation Tax:
Legal entities resident in Spanish territory constituted for the purpose of the "UEFA Women's Champions League 2020" final by the organizing entity or by the participating teams will be exempt from Corporation Tax for the income obtained during the celebration of the event and to the extent that it is directly related to their participation in it.
- B) Regarding Value Added Tax:
- Refund of fees paid as a result of transactions related to the holding of this event:
- Businesses not established in the Community: the reciprocity requirement provided for in Article 119 bis of Law 37/1992 will not be required.
- Organizing entity, participating teams, legal entities formed by both parties for the purpose of this event, and entrepreneurs not established in the Peninsula and Balearic Islands:
Those who qualify as taxable persons will be entitled to a refund of the input VAT paid on this event at the end of each tax period. The tax period will coincide with the calendar month, and tax returns must be filed within the first 20 calendar days of the month following the tax period, except for the last period of the year, which must be filed within the first 30 calendar days of January.
These business owners will not be required to keep the Tax Register Books through the Electronic Office of the AEAT (SII).
In the case of non-established entrepreneurs or professionals who meet the requirements set out in articles 119 or 119 bis of Law 37/1992, the refund of input VAT will be carried out in accordance with the procedure established in said articles and in articles 31 and 31 bis of the Tax Regulations, approved by Royal Decree 1624/1992.
When dealing with entrepreneurs or professionals not established in the Community, the Canary Islands, Ceuta or Melilla, or in a State with which there are instruments of mutual assistance analogous to those established in the Community, it will not be necessary for them to appoint a representative for the purposes of compliance with tax obligations relating to VAT (exception to the provisions of Article 164.One.7º LIVA).
- Temporary importation of goods with total exemption from duties
The importation of goods used temporarily in the development of this event will be exempt from VAT. The maximum period of 24 months for their use, as provided for in Article 9.3.g) of the VAT Law, will expire no later than December 31 of the year following the conclusion of this sporting event.
- Localization of services: effective use rule
The rule established in Article 70.2 of the Spanish VAT Law (LIVA), according to which certain services located outside the EU are taxed within the Spanish VAT territory if their effective use occurs there, will not apply when the services are provided by legal entities resident in Spain, established specifically for this event by the organizing entity or the participating teams, and are related to the organization, promotion, or support of said event. Therefore, services such as event advertising, provided by these entities to businesses established outside the EU, will not be subject to VAT.
- PROPERTY TRANSFER TAX AND STAMP DUTY (ITP AND AJD)
Exemption from Stamp Duty for deeds formalizing mortgage moratoria for the tourism sector and for the public freight and discretionary passenger transport sector by bus
In the second final provision of Royal Decree-Law 27/2020, number 30 of article 45.IB) of the consolidated text of the Law on Property Transfer Tax and Documented Legal Acts (Royal Legislative Decree 1/1993, of September 24) is modified to declare exempt from documented legal acts the deeds of formalization of the moratoria of mortgage loans and credits and of leases, loans, leasing and renting without mortgage guarantee that occur in application of:
- of the mortgage moratorium for the tourism sector (articles 3 to 9 of Royal Decree-Law 25/2020, of July 3, on urgent measures to support economic recovery and employment), and
- of the moratorium for the public freight transport sector and discretionary passenger transport by bus (articles 18 to 23 of Royal Decree-Law 26/2020 of July 7, on economic reactivation measures to address the impact of COVID-19 in the areas of transport and housing).
- ELECTRONIC SIGNATURE
Final Provision Four of Royal Decree-Law 27/2020 amends Article 13 of Law 59/2003, of December 19, on electronic signatures. It grants the Ministry of Economic Affairs and Digital Transformation the authority to determine, by Ministerial Order, the conditions and technical requirements applicable to identity verification when alternative methods of proving identity are used, other than physical appearance at registry offices.
- LAW 13/2011 ON THE REGULATION OF GAMBLING
Royal Decree-Law 27/2020 modifies the first transitional provision of Law 13/2011, of May 27, on the regulation of Gambling, to indicate that the powers related to the management and collection of fees derived from the administrative management of gambling will be exercised by the State Tax Administration Agency.
Until the corresponding regulatory standard is approved, the self-assessment of the fee for the administrative management of gambling regulated in article 49 of Law 13/2011, will continue to be carried out at the Headquarters of the Directorate General for Gambling Regulation, through the following link
https://sede.ordenacionjuego.gob.es/convocatoria=28
You can contact this professional office for any questions or clarifications you may have.
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A Àmbit Assessor, SL has 40 years dedicated to the tax, comptable and labor consultancy of the Pime.
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