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Date Published: 28/12/2022

ARCHIVED - Relief for shoppers as Spanish government reduces VAT on food

ARCHIVED ARTICLE -

Several staple items like bread and milk will have a 0% VAT rate for the next six months in Spain

<span style='color:#780948'>ARCHIVED</span> - Relief for shoppers as Spanish government reduces VAT on food

The Spanish government announced a new package of crisis measures on Tuesday December 27 to ease the burden of rising inflation on families, among which was the controversial decision to scrap the 20 cent per litre fuel bonus for all but professional drivers from January 1.

A very welcome move, however, is the announcement that the VAT rate on several staple grocery items will be drastically reduced on the first day of the new year for the next six months.

Many households have been feeling the pinch throughout 2022 as the price of the most common food items shot through the roof, with inflation reaching a peak of 15.4% in October. According to the latest data, the cost of milk has risen by 30.9%, eggs by 27.1%, cereals by 22.9%, potatoes by 21.5%, bread by 14.9% and legumes and vegetables 14.6%.

With the new measures, the VAT on many basic food items will be eliminated altogether, while other products will see this tax reduced substantially.

Food subject to 0% VAT from January:

Bread
Milk
Eggs
Cheese
Fruits
Vegetables
Legumes
Vegetables
Tubers
Bread-making flours
Cereals

In addition to these staple foods, other basic products will benefit from a reduction in VAT from 10% to 5% during the same period.

Food subject to 5% VAT from January:

Pasta (spaghetti, macaroni, ravioli etc.)
Oil

Food that will remain at 10%:

Meat
Yogurts
Fish
Coffee
Preserves
Bottled water

One of the largest exceptions from the VAT reduction is sugar, the cost of which has risen by more than 50% this year, causing many confectionery companies to raise their prices exponentially this Christmas.

Likewise, sugary and alcoholic drinks and juices will continue with their usual VAT rate of 21%, along with personal hygiene and cleaning products.

The new measures will no doubt come as a huge relief to consumers in Spain, who are enduring the most expensive holiday season in recent times.

Image: Archive

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