Spain Money Saving Tips and Offers

The Organization of Consumers and Users (OCU) has today estimated that the planned Spanish VAT (IVA) rise in July, from 16% to 18% in general VAT and from 7% to 8% in the reduced rate, will cost about 290 euros per year to each Spanish family.

Estimates of the association are based on average household spending in the latest published results from the National Statistics Institute, INE, where household budgets amounted to 31,953 million in 2008.

Experts at the OCU removed VAT exempt goods and services from the estimate (medical services, housing rent, education, etc.) as well as spending on basic foodstuffs, which are taxed at the super-reduced VAT rate of only 4%.

However, the OCU did point out that, when the July hike comes, many companies are still discussing whether they will carry the tax increase themselves and absorb the rise in their profit margins, or if the VAT increase will indeed be passed on to their clients and customers.

Source: kyero.com