VAT treatment of the supply of power in charging points for electric cars
As a result of the increase in registrations of electric vehicles and installation of charge points in Spain, as well as the specific regulations related to electricity supplies, the General Directorate of Taxation (GDT) has issued a binding ruling confirming the VAT treatment of energy companies (suppliers) that intend to install vehicle charge stations at shopping centres and parking lots.
In particular, under the ruling, an energy company that performs the following activities is considered a supplier when:
- The company supplies the power to the final consumers (persons with electric vehicles), as well as other services for improving the experience and quality of the services, such as a mobile application that provides information on a car battery’s status and a specialised call centre.
- The company has entered into a leasing agreement with the owners of the shopping centres and parking lots for specific space to install the infrastructure needed to supply power to charge electric vehicles.
The DGT concluded that, based on the terms of the Spanish Electricity Industry Act, the shopping centre and parking lot owners are able to re-sell the electricity acquired for its own business to final consumers even if this supply is carried out by a third party (electricity suppliers) through the vehicle charge stations installed. Therefore, in addition to the electricity suppliers, both the shopping centre and parking lot owners are considered re-sellers of electricity and the operations they carry out are liable to Spanish VAT at a rate of 21% (general VAT rate).
Regarding the rest of the services, the GDT has followed the criteria stated in the different rulings issued by the Court of Justice of the Europe Union (CJEU) for complex services (for example, the following cases: Card Protection Plan C-349/96, Madgett and Baldwin C-308/96 and C-94/97). Based on these rulings, those services are deemed ancillary to the principal service, given that they are supplied so that the end user can better enjoy the principle services (the supply of power for recharging the car). Thus, the GDT is of the view that the VAT treatment of the ancillary services is the same as for the principal supply of power energy.