Tax-free benefits stop being available in Spain through VAT refund solutions platform Woonivers from February 28.
The platform, which launched its service in September 2019, consists of an easy-to-use app in which the consumer logs in, scans tourists’ passports and uploads their invoices. Once complete, it guides through the process of validating and refunds up to 21% of the expenses.
The app was the first initiative in the Spanish market that returned taxes to non-EU citizens in an easy and simple way, without any intermediaries. Customers benefit from a 100% digital process with a higher return than the traditional facilitation method available at airports. Big and small businesses are able to reimburse tax without any major costs or complex procedures, which in turn helps to increase sales.
A blow to the Spanish owned business
The decision to close Woonivers has come as a blow to Spanish owned businesses who feel that they will lose potential future revenue. The temporary suspension of the app is as a result of issues around bureaucracy in relation to the Spanish government.
The Business Consulting and Development Association of La Línea de la Concepción (AADELL) predicted that this decision would likely affect many businesses across Spain which rely on tax- free benefit schemes to support their turnover, stating, “We are sorry about Woonivers’ conclusion because the system was working perfectly, and numerous clients were using it. It’s a shame that Spanish legislation is not working under these circumstances”.
More traditional VAT refund facilitators to be used
From February 28 the app will be officially suspended until a new resolution is in place which encourages digitalization of the sector and focuses on consumers. “For the moment, we will focus our efforts on the countries where we are currently present, where better legislation is in place,” a spokesman from Woonivers said.
Moving forward, if businesses want to offer a tax-free benefit, they will have to work with more traditional facilitators who currently operate an arguably slower and more bureaucratic process. Woonivers will continue working in countries such as Belgium, France, Portugal and Italy.
