Monday, July 4

Extension of the VAT reduction for masks at 4% and for medical supplies at 0%

The Council of Ministers gives the green light to both measures to guarantee continuity in the response of the health system to the new variants

The Minister council has approved this Tuesday the extension until June 30, 2022 of 4% VAT on deliveries, imports and intra-community acquisitions of disposable surgical masks and 0% in the case of sanitary material to combat the coronavirus whose recipients are public entities, non-profit organizations and hospitals. Both tax breaks ended on December 31, but the Executive has decided to keep them for six more months “to guarantee continuity in the response of the health system in controlling the pandemic and the new variants of covid-19.”

The Government approved in April 2020 the reduction to 0% of VAT on internal deliveries, imports and intra-community acquisitions of sanitary material until July 31, 2020 and extended it until October 31, after the European Commission gave its approval of the VAT exemption regarding the importation of the necessary merchandise to combat the effects of the covid-19 outbreak during the year 2020.

Later, it was extended until April 30, 2021 and, subsequently, until December 31, 2021, under the Community regulation. Now, after a new decision has been approved by Brussels, with effect until June 30, 2022, “and the effectiveness of the measure has been verified,” its application is extended again during the first half of 2022.

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And the same happens with the VAT reduction for masks, a measure that generated much controversy a year ago with the government’s refusal to implement it for fear of community sanctions. However, the Executive will extend it again for six more months given the “widespread use that the population is being forced to make of these as a result of the prolongation of the pandemic”, something that the Minister of Finance had already announced, Maria Jesus Montero, during the debate on the 2022 Budgets in the Senate.

With this reduction from 21% to 4%, the price of the surgical mask sold to the public goes from 96 cents to 82.5 cents, which represents a saving of 13.5 cents per unit (1.35 euros less in the pack of 10 masks). For a family of four, in which each of them uses a mask per day, the monthly savings for this measure would be about 16 euros.

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