{"id":3347,"date":"2021-07-19T05:04:04","date_gmt":"2021-07-19T05:04:04","guid":{"rendered":"https:\/\/www.yellowcar.com\/what-is-the-vat-on-rental-cars\/"},"modified":"2023-12-13T10:47:33","modified_gmt":"2023-12-13T10:47:33","slug":"what-is-the-vat-on-rental-cars","status":"publish","type":"post","link":"https:\/\/www.yellowcar.com\/en\/what-is-the-vat-on-rental-cars\/","title":{"rendered":"What is the VAT on rental cars?"},"content":{"rendered":"

VAT on car rental is the general rate<\/strong>, i.e. 21%<\/strong>. If you have ever rented a car, you will have seen on your invoice what VAT is charged on rental cars: the general rate, with no exceptions of any kind and without the possibility of exemptions.<\/p>\n

VAT on car rental<\/h2>\n

Businesses in the sector have been calling for years for a reduction in the tax rate, as they find it curious that their activity is taxed at 21% VAT<\/strong> while other activities, such as passenger transport or tourist services, are taxed at only 10%.<\/p>\n

Car rental in the province of Malaga<\/a><\/strong>, where Yellow Car<\/strong> operates, is almost entirely associated with tourist activity. This led the National Federation of Car Rental Companies with and without drivers (FENEVAL)<\/strong> to study the impact of reducing this tax rate in 2020.<\/p>\n

FENEVAL estimated that the non-reduction of VAT could lead to the disappearance of hundreds of companies in the sector and the loss of more than 1,500 jobs in 2020 alone<\/strong>. Many car rental companies are SMEs and are in a more difficult position to survive a lasting economic crisis.