Are you planning a trip to Madrid, Spain and wondering about the sales tax? Let’s explore the basics of sales tax in Madrid, Spain.
What is Sales Tax?
Sales tax is a type of consumption tax that is levied on goods and services sold to the final consumer. The amount of sales tax charged varies from country to country and even within different regions of the same country.
Sales Tax in Madrid, Spain
In Madrid, Spain, sales tax is known as Value Added Tax (VAT), or Impuesto sobre el Valor Añadido (IVA) in Spanish. The standard rate for VAT in Madrid is 21%. However, reduced rates are also applicable for certain goods and services such as food items, books, and cultural events.
Reduced VAT Rates in Madrid
- 10% VAT rate: Applies to certain food items such as fruits, vegetables, meat products, eggs, milk, bread, and cereals.
- 4% VAT rate: Applies to books (printed or digital), newspapers and magazines (printed or digital), medicines with a prescription from a doctor or dentist.
- Reduced cultural VAT rate: The reduced cultural VAT rate is 10% on tickets for live performances like concerts or theater shows. Cinemas pay a 21% standard rate.
Tax-Free Shopping in Madrid
If you are a non-EU resident visiting Madrid for tourism purposes only, you can enjoy tax-free shopping. This means that you can claim back the VAT paid on your purchases when leaving the EU.
To qualify for this service, the total value of your purchases must exceed €90.15 per store per day. Keep all your receipts handy so that you can claim your refund at any participating vendor’s office at the airport.
Conclusion
In conclusion, sales tax in Madrid, Spain is known as VAT, and the standard rate is 21%. However, reduced rates are applicable for certain goods and services such as food items, books, and cultural events. Non-EU residents visiting Madrid for tourism purposes can also enjoy tax-free shopping and claim back the VAT paid on their purchases when leaving the EU.
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