The Spanish Tax Agency has announced a temporary reduction in the VAT rate on electricity supplies from 21% to 10% as provided by Royal Decree-Law 12/2021 in response to increased electricity prices. The reduction applies until 31 December 2021 where the average monthly market price exceeded EUR 45 / MWh in the previous month. Further, the reduction is limited to supplies of electricity where the contracted power does not exceed 10 kWh, meaning the reduced rate is primarily available for sm…