Spain axes VAT of basic foods in third raft of anti-crisis measures

Madrid, Dec 27 (EFE).- The Spanish government put forward a new raft of measures to tackle the cost of living crisis on Tuesday that will see VAT slashed on food products over the next six months.

Prime minister Pedro Sánchez discussed the third package of measures to mitigate the economic fallout of the war in Ukraine with reporters after his cabinet approved the new measures.

“The Government is going to ensure that VAT reductions and aid to farmers are transferred directly and immediately to food prices,” Sánchez said.

Staple foods will no longer be taxed

Basic foods currently on a 4% tax rate would be VAT exempt and others taxed at 10% would be downgraded to a 5% VAT rate, the prime minister continued.

Staple foods such as bread, bread flour, milk, cheese, eggs, fruits, vegetables, legumes, potatoes and cereals will no longer be taxed.

Other foods such as oils and pasta have been downgraded from a 10% VAT rate to 5%.

The government has also announced 300 million euros in direct aid to farmers to offset the increase in the cost of fertilizers.

Sánchez said some 4.2 million low-income homes would be handed a 200-euro check.

“This government is going to continue protecting ordinary people,” Sánchez concluded. EFE

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