The Spanish government had to be threatened with the Court of Justice to announce that it will apply the VAT exemption for SMEs and self-employed.

Omissions

• The source indicating Spain announced it will apply the exemption after the CJEU referral could not be verified; available sources confirm the infringement procedure but do not confirm Spain's subsequent announcement to comply. The European Commission referred Spain to the CJEU on March 12, 2026, and Spain had previously stated it did not intend to apply the VAT exemption.

Sources

• SecondaryKPMG Tax News FlashThe European Commission decided to refer Spain to the Court of Justice of the European Union (CJEU) for failure to transpose two EU VAT directives: the directive providing for a VAT exemption for SMEs and the directive on the special scheme for second-hand goods.
• SecondaryThe European StingSpain has indicated that it does not intend to apply the VAT exemption for SMEs as set in the Directive. The Commission decided to refer Spain to the Court of Justice of the European Union for failing to transpose VAT measures into national law.
• SecondaryARA EnglishBrussels takes Spain to European court for not exempting SMEs and the self-employed from declaring VAT. The European directive aims to reduce the paperwork for self-employed workers who invoice less than 85,000 euros annually.