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With effect from 1 January 2019 , Royal Decree-Law 26/2018, of 28 December, adds a new number 13.º in article 91.Uno.2 of Act 37/1992, of 28 December, of the Value Added Tax Act (LIVA), which applies the tax rate of 10% to the following services:
"13.º Services rendered by performers, artists, directors and technicians that are individuals, to the producers of motion pictures to be exhibited in theatres and to the organisers of plays and musicals."
Thus, the application of the reduced tax rate for this type of services is recovered, which were taxed at the general tax rate of 21% at 1 September 2012 with the modification introduced by Royal Decree-Law 20/2012, of 13 July.
In accordance with the current doctrine of the Directorate General for Taxes, the following matters must be clarified when determining whether the requirements are fulfilled for the application of the 10% tax rate:
The service must be provided to organisers of exhibitions of live performing arts and music events. Organisers of exhibitions of live performing arts and music events are considered to be the person or company that carries out business or professional activities involving the organisation of material and human production factors with a view to the performance of the live performing art or music event (hiring of premises, advertising, sales of tickets, etc.)
Organisers of exhibitions of live performing arts or music events may be:
Services provided by interpreters, artists, directors or technicians, individuals to companies that are not in charge of the organisation of the work or are merely mediators will be taxed at 21%.
The services provided must be theatrical works or musicals.
Theatrical works are considered to be dramatic representations, dramatic - musical, choreography, pantomimes and literary representations when involving recitals or stage adaptations.
Musical theatre is a theatrical performance that combines sounds that can be joined or not to a literary text.
To apply the reduced rate, the following is not taken into account:
Artistic representations with puppets (consultation 1500-98), puppet theatre (consultation 1570-98), story-telling and poetry reading during flamenco concert (consultation 2392-99) will be taxed at 10%.
Magic shows are not considered theatre and shall be taxed at 21%.