Europa Press, Getty Images Good News From Hacienda That Delights Many: It'll Be Cheaper Starting Today
The Treasury is forced to lower the VAT on all types of bread, including those considered 'special.'
Hacienda has reduced the VAT on a wide variety of special breads, including gluten-free bread. This decision is due to a Supreme Court ruling on October 15. It determined that these products should benefit from the super-reduced VAT rate, just like common bread.
What Has Happened with Hacienda and the VAT on Breads? Forced to Lower It
The Supreme Court ruled that the difference in VAT between common bread and special breads contradicted an important fact. It is none other than the principle of tax neutrality and European Union regulations.
According to the ruling, for the average consumer there is no significant difference between these types of bread that justifies different tax treatment. Therefore, Hacienda has been forced to adjust the regulations and apply the super-reduced 4% VAT to all types of bread.
All These Products Now Taxed at 4%
Before this resolution, everything was very different. Multigrain bread, baguette, ciabatta, toast, breadsticks, rusks, bread rolls, sliced bread and breadcrumbs were taxed at a 10% VAT.
With the new regulations, all these products are now taxed at 4%, equating them to common bread. This measure also includes gluten-free bread, directly benefiting people with celiac disease, who will now be able to purchase these products at a more affordable price.
Application of the New VAT Without Distinction Between Ingredients
Hacienda's resolution, published in the Official State Gazette (BOE), establishes the following. The super-reduced 4% rate will apply to all products that, according to Royal Decree 308/2019, are considered common bread, special or semi-finished products.
This includes those made with gluten-free flour or where the flour has been replaced by other ingredients naturally free of gluten. Regardless of whether these ingredients are predominant in their composition. This way, the distinction based on the ingredients used in bread making is eliminated.
Reactions to the New Regulations
The Spanish Confederation of Bakery, Pastry, Confectionery and Related Products (Ceopan) has expressed its satisfaction with this measure. They consider it a positive decision for both the sector and consumers, especially for groups of people with celiac disease.
Additionally, they highlight that this resolution complements the Bread Quality Standard promoted by the confederation. Meanwhile, the Spanish Association of the Bakery, Confectionery and Pastry Industry (Asemac) has described the measure as "historic". It corrects a situation that, according to them, limited the consumption of special breads and hindered the development of the bakery industry.
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