Tax Commentary 8-2014
TAX REFORM
New legislation on value added tax, the Canary Island general indirect tax, excise and special taxes and environmental taxation
Law 28/2014, of November 27, 2014, amending Value Added Tax Law 37/1992, of December 28, 1992, Law 20/1991, of June 7, 1991, amending tax aspects of the Canary Islands tax-economic scheme, Excise and Special Taxes Law 38/1992, of December 28, 1992, and Law 16/2013, of October 29, 2013, establishing certain environmental taxation measures and adopting other tax and financial measures
As part of the tax reform, Law 28/2014 contains the amendments relating to indirect taxes and environmental taxation published in the Official State Gazette on November 28, 2014.We summarize below the main changes affecting these taxes.
Even though some amendments are made to the system for different technical reasons than others, for the sake of consistency in the Spanish tax system, the changes affecting value added tax (VAT) are usually reproduced exactly in the legislation on the Canary Island general indirect tax, despite the fact that the Canary Islands fall outside the scope of the common VAT system and, accordingly, are not subject to Community legislation or case law precedents.
For this reason, to avoid unnecessary repetition, the amendments affecting both VAT and the Canary Island general indirect tax will be explained together.
Some of the statutory provisions must be implemented by regulations. In relation to VAT, a draft royal decree has already been submitted to public consultation in compliance with the implementation requirement. Although the wording has not yet been approved and, accordingly, cannot be regarded as final, we will refer to this draft decree as necessary to complete our analysis of the provisions.
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