Faced with the great challenges facing the agri-food sector, ALAS (Alliance for…
The meat sector as a whole is experiencing moments of extreme difficulty due to the COVID crisis 19. With the exception of a few large companies, most of the meat industry in Spain is made up of small and medium-sized companies that have completely lost their sales in the channel HORECA and proximity sales. They do not have money, but they have to face social security payments, taxes, rents and payments to suppliers, especially to farmers. There is a crisis in the sector that will be very difficult to overcome.
For this reason, Anafric, a meat business association that represents the sector transversally, calls on the Treasury to provide liquidity to SMEs in the sector, returning “immediately” the VAT that these companies have advanced to the Treasury on the purchase of products that, after if they are transformed, they are destined for export: “The Treasury is taking an average of 5 months to return this VAT, an exaggerated and unjustified period, which does not correspond to the surrounding countries or to the average terms worldwide, with which the central government is precipitating the sector into a lack of liquidity that seriously compromises it, “says José Friguls, president of Anafric.
How the Tax Agency in Spain works on exports
In general terms, the law gives the Tax Administration a maximum period of 6 months to verify the requested returns, from which interest is accrued in favor of the taxpayer. However, this generic term has no justification in relation to VAT, and even less so for the frequent exporter, where the Administration has access to taxpayer information in real time, so “the Tax Administration should streamline the refund procedure , especially in an economic context like the current one.”
For frequent exporters, this delay in settling VAT refunds is especially serious “because, by supporting VAT on their purchases but not passing it on to their exports, the constant balance of their settlements is in their favor, with which they are permanently seen in this situation of having to wait the average 5 months that it takes the Treasury to pay them, “explains the president of Anafric.
How the tax administration works in other countries
However, in practice, there are surprising differences with respect to other neighboring countries that have designed mechanisms in order not to strain the liquidity of exporters.
- In Italy, those companies that meet certain requirements will be considered as “recurring exporters” (esportatori abituali), which allows them not to bear VAT on the purchases / imports they make.
- Along the same lines, there would be the case of France, where it is possible to obtain a certificate that the Company is exempt from VAT for acquisitions that will subsequently be exported.
- Likewise, if we focus on the maximum return period of 6 months in Spain (with the average return period being 5 months in practice), we observe that it is significantly longer than that which exists, both in countries within the European Union and in countries outside her. Thus, we have the examples of Portugal (30 – 60 days) or Germany and Belgium (3 months); and outside the EU, Chile, (5 business days) or Malaysia (28 days).
José Friguls exposes the seriousness of the situation. “We cannot afford to spend another day in this reality. We represent a sector that has been at the forefront during this pandemic and instead we do not see any interest from the public authorities. We do not claim aid, we do not ask for subsidies. Only that the sector receives its own: what it has paid by law in advance, which is returned to it to guarantee liquidity and its jobs.”