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The small print of duty-free imports of goods to combat the effects of the COVID-19 outbreak

| COVID-19 / News | Tax

Regarding the European's Commission Decision 2020/491 on the granting of relief from import duties and VAT on the import of goods, needed to combat the effects of the outbreak of COVID-19

On April 3rd 2020, the European Commission published Decision 2020/491 on the granting of relief from import duties and VAT on the import of goods, needed to combat the effects of the outbreak of COVID-19.

Thus, in accordance with this Decision, imports of goods intended to cover the effects of COVID 19 will be exempt from import duties and VAT from 30th January 2020 until 31st July 2020, with possible extensions to be agreed.

Initially, the great doubt raised by this tariff exemption was its scope, since according to the wording of the regulation, its application was limited to imports made by public entities or entities of a philanthropic nature. However, given the magnitude of the disaster, it is clear that limiting its application to certain types of organizations meant ignoring the reality of the situation.

Surprisingly, in the Decision, it is clear that, as the Customs Department maintained in its information note NI GA 11/2020, only imports made by public entities, entities of a philanthropic nature or any other type of importer will be exempt, whereas in the latter case it is required that such imports be destined for subsequent donation to entities that enjoy the corresponding administrative authorization provided for in Article 17 of the VAT Regulations.

Therefore, it turns out that not all imports of material intended to cover the effects of COVID 19 will be exempt, since imports of medical material by companies and/or importers who, as a result of their activity, are obliged to provide medical and protective material to their employees, as would be the case with agro-food companies, supermarkets, security companies, etc., will be subject to tax.

Import levies bring profits to the European Union and the Member States, and so it is surprising, to say the least, to see the scope of this decision, as it is clear to all that, over the next few months, the import of all kinds of material will be necessary in order to deal with the COVID 19 pandemic.

Such imports will be the result of regulatory changes that Member States are expected to impose in order to reduce the number of infections and, by extension, the cost of further infections.

Although combating COVID 19 is a State task requiring the collaboration of all actors, it is the State's task to provide the population with preventive measures to avoid a new potential infection. In those cases where employers decide to take over this function that their economic interests be harmed is not acceptable, being obliged to pay import duties which, in the end, feed the State's coffers and which, morally, are questionable in view of the purpose of such imports.

You can read the article in Expansión

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