The three current rates, which products and services fall under each one, and the recargo de equivalencia.
VAT in Spain is not a single rate. Law 37/1992 establishes three different tax rates — standard (21%), reduced (10%) and super-reduced (4%) — plus a category of exempt operations. Knowing which one applies to each product or service is essential for correct invoicing, because applying the wrong rate can force you to issue a factura rectificativa and, in the worst case, result in a penalty.
The structure of Spanish VAT is based on three tax rates set out in articles 90 and 91 of Law 37/1992. The standard rate is 21% and applies by default. The reduced rate is 10% and covers products and services considered more essential. The super-reduced rate is 4% and is reserved for basic necessities. In addition, there is the recargo de equivalencia, a special regime mandatory for certain retail traders.
The standard rate of 21% applies to all goods and services that are not expressly included in the reduced, super-reduced or exempt categories. It is, so to speak, the "default" rate — if a product or service does not appear in the lists of articles 91 or 20 of the Ley del IVA, it is taxed at 21%.
This includes clothing, electronics, vehicles, professional services (advisory, consulting, design), alcoholic beverages, sugary drinks, tobacco, jewellery and the vast majority of products and services consumed on a daily basis.
The reduced rate of 10% covers a wide variety of products and services that the law considers of greater social necessity, though not basic enough to warrant the 4% rate. The full list is in article 91.Uno of the Ley del IVA.
In food, the 10% rate applies to foods not included in the super-reduced category — meat, fish, yoghurt, drinks without added sugar, seed oils and pasta. Water, both bottled and mains supply, also goes at 10%.
In services, the most relevant are hospitality and catering, passenger transport, hotel accommodation, entertainment (cinema, theatre, sporting events), hairdressing and funeral services. Also included are feminine hygiene products, home renovation works (subject to conditions) and, since 2025, electricity and natural gas for domestic consumption.
The super-reduced rate of 4% is reserved for absolute basic necessities. The list is short and is in article 91.Dos of the Ley del IVA.
In food, the 4% rate applies to bread, bread-making flour, milk, cheese and eggs. Also fruits, vegetables, legumes, tubers and cereals in their natural state. And since January 2025, olive oil — which was previously taxed at 10% — moved permanently to 4%. This change, which occurred after a temporary period of 0% during the inflation crisis, is one of the most significant tax developments in recent years.
Outside food, the 4% rate applies to books, newspapers and magazines (as long as they are not advertising), medicines for human use, prosthetics, orthotics and implants for people with disabilities, and subsidised housing (VPO).
The recargo de equivalencia is a special VAT regime (articles 148 to 163 of Law 37/1992) that many retailers are unaware of until their supplier applies it for the first time. It is mandatory for retail traders who are natural persons (autónomos) and sell products to end consumers without transforming them — clothing shops, hardware stores, stationery shops, etc.
The mechanism is peculiar: the supplier charges the retailer the normal VAT plus an additional surcharge (5.2% on the standard rate of 21%, 1.4% on the reduced rate of 10%, 0.5% on the super-reduced rate of 4%, and 1.75% on tobacco). In exchange, the retailer does not file VAT returns (neither modelo 303 nor modelo 390), because it is understood that the tax has already been advanced through the surcharge.
It is important to understand that this regime is not voluntary — if you meet the requirements (natural person, retail sales, no product transformation), you are obliged to apply it. And it has an important consequence: since you do not file VAT returns, you also cannot deduct the input VAT on your purchases.
In addition to the three tax rates, there are operations that are exempt from VAT. This does not mean they are taxed at 0% — it means the law expressly excludes them from the tax. The most relevant are medical and healthcare services, regulated education and training, and insurance services and financial operations.
A special case is exports and intra-Community supplies of goods, which are exempt but with the right to deduction — that is, you do not charge VAT to the customer, but you can deduct the input VAT on your purchases related to those operations.
CokuApp includes all current VAT rates and lets you configure the tax rate for each product or service.