Spain Clarifies VAT Rate for Special Breads
Following a recent Court decision, special breads should benefit from super-reduced VAT rate of 4% instead of 10%.
The Spanish Directorate General of Taxes (DGT) has clarified the VAT rate applicable to the supply of specialty breads, following a Supreme Court ruling on 15 October 2024. This ruling establishes that breads considered “special” should benefit from the super-reduced VAT rate of 4%, aligning them with standard bread in terms of tax treatment.
According to the court, not applying the 4% rate to certain specialty breads infringes on the principles of VAT neutrality and free competition, especially when the differences between products are not perceptible to the average consumer. The full judgment is available here, while the Spanish DGT’s decision dated 24 February 2025 can be found here.
Breads Eligible for the 4% Super-Reduced VAT Rate
In line with the court's interpretation, the DGT has confirmed that the following types of bread are eligible for the 4% VAT rate, among others:
- Breads made with cereal flour and alternative flours such as amaranth, quinoa, or buckwheat.
- Multigrain breads containing at least three different flours, with a minimum of two derived from cereals.
- Vienna bread, snow bread, and bonbon bread, made from soft wheat flour and possibly including sugars, milk, fats, or oils.
- Toasted bread
- Biscuits
- Molded bread
- Bread crumbs
- Hamburger buns, including brioche buns
Furthermore, the 4% VAT rate also applies to flour and dough sold for preparing these specialty breads, not just the final products sold to consumers. This is confirmed in Binding Ruling V0281-15, dated 14 March 2025.
Separately, 4% VAT rate shall also apply to products that meet the definition of common bread, special bread, or semi-finished products, have been made with gluten-free flour, either naturally or because it has undergone special treatment to reduce its gluten content, or in which flour has been replaced by other naturally gluten-free ingredients, even if these constitute the majority of the flour's composition.
In essence, the super reduced VAT rate applies to all types of bread -common, special and semi-finished bread products- included in the Royal Decree 308/2019, as well as to those gluten-free breads that may be included in such definitions.
How Can Marosa Help Handle VAT Rate Changes?
With the introduction of this change, businesses should review their pricing, invoicing systems, contracts, and compliance processes to ensure accurate VAT application.
Marosa supports companies operating in Spain with end-to-end VAT compliance services, helping clients to apply the correct VAT rates based on delivery dates and completion of services. Also, our VAT reporting software identifies inconsistencies, manages deadlines, and ensures that VAT returns are filed correctly — so you can remain compliant while focusing on your core operations.