The Canary Islands General Indirect Tax or better known as IGIC is a state tax of indirect nature that taxes the delivery of goods and provision of services, as well as imports of goods made by entrepreneurs and professionals residing in the Canary Islands.

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It is the tax equivalent to the Value Added Tax (VAT) applicable in the peninsula.

Scope of application

The scope of application of IGIC is limited to the Canary Islands.

IGIC tax rates

In IGIC different tax rates are established:

• Zero rate: 0%.
• Reduced: 3%.
• General: 7%.
• Increased: 9.5% and 13.5%.
• Special: 20%-35%.

The application of the zero rate allows the deduction of the tax borne by the taxpayer in their acquisitions of goods and services.

Types of regimes

General Regime: It applies to entrepreneurs and professionals who do not exclusively perform exempt operations inside the Canary Islands.

Special Regimes: They apply according to the condition of the taxpayer or the economic activity they perform:

• To natural persons and entities under income attribution regime that perform certain activities: simplified special regime.
• To certain farmers and ranchers: special regime for agriculture and livestock.
• To tour circuit organizers: special regime for travel agencies.
• To importing retail merchants: special regime for retail merchants.
• To certain wholesale merchants: special regimes for used goods and art objects, antiques and collectibles.
• To manufacturers and wholesale merchants of pure gold that serves as the basis for financial operations (investment gold).

I hope this information is useful to you :)