IGIC Rates 2026: The Complete Table by Product

IGIC is not a flat-rate tax. If you invoice in the Canary Islands and only know about the 7% rate, you’re missing half the picture.

There are several distinct rates, and the one you apply depends on the product or service — not on habit. Confusing them is the most common, and most expensive, mistake when invoicing in the archipelago.

Here’s the complete table: which rate applies where, with examples, and how it all gets filed afterward.

What IGIC is, and why the Canary Islands have it

IGIC (Impuesto General Indirecto Canario — the Canary Islands General Indirect Tax) is the Canary Islands’ equivalent of VAT. It applies to the sale of goods and services within the archipelago, replacing the VAT that applies on mainland Spain and the Balearic Islands.

It exists within the REF (Régimen Económico y Fiscal — the Canary Islands Economic and Fiscal Regime), a long-standing framework designed to offset the territory’s remoteness and fragmentation.

The most noticeable difference: the general IGIC rate is 7%, compared to 21% standard VAT on the mainland. But reducing IGIC to “Canary VAT at 7%” undersells it. Like VAT, it has several brackets.

If you sell outside the Canary Islands to mainland Spain, or buy from mainland suppliers, the mechanics change again — we cover that in depth in IGIC vs. VAT: complete tax guide.

The complete table of IGIC rates for 2026

This is the quick reference. Save it.

Rate	Percentage	What it typically covers
Zero rate	0%	Essential goods: basic foodstuffs, water, medicines, books, and — from 2026 — hospital beds
Specific rate	1%	Petroleum and refined petroleum derivatives (new in 2026; previously 0%)
Super-reduced rate	3%	Certain essential goods set by regulation
Reduced rate	5%	Specific goods defined by regulation, such as certain soft drinks
General rate	7%	Most goods and services that don’t fall under a specific rate
Increased rates	9.5% and 15%	Specific consumer goods; for example, energy drinks are taxed at 15% from 2026
Special rate	20%	Manufactured tobacco

General rate: the default 7%

The general rate is the rule, not the exception. If you sell a professional service, consulting, most retail products, or digital services, the rate you apply by default is 7%.

It’s the rate you’ll see on most of your invoices if your activity doesn’t fall into a special category. For freelancers and businesses invoicing services — consulting, design, development, training — 7% is almost always the correct rate.

The comparison that matters: against the mainland’s 21% general VAT rate, the 7% rate translates directly into either a lower final price for your customer or a wider margin for you if you absorb the difference.

Zero rate: what doesn’t pay IGIC

The zero rate means the transaction is subject to IGIC, but taxed at 0%. That’s not the same as an exemption: it’s still a declarable transaction, it simply generates no tax due.

It’s reserved for goods considered essential: typically basic foodstuffs, drinking water, medicines, and books. From 2026, medical, electro-medical, and hospital beds are also zero-rated. The full list and its conditions are set in the current regulation, so it’s worth confirming the specific good before applying it.

Super-reduced and reduced rates: the middle ground

Between the zero rate and the general rate sit two intermediate brackets for goods that receive favorable tax treatment without being strictly essential: the super-reduced rate of 3% and the reduced rate of 5%. The consolidated IGIC text (Decreto Legislativo 1/2025) defines what falls under each.

This is the zone that raises the most questions, because it isn’t always intuitive which category applies — for example, soft drinks can be taxed at different brackets depending on their sugar content. If your activity sits here, confirm the specific good in the regulation before setting prices.

Increased rates and the special rate

At the other end are the rates that tax above the general rate: the increased rates of 9.5% and 15%, and the special rate of 20%.

They apply to specific categories that regulation treats differently: non-essential consumer goods or goods subject to specific taxation. Manufactured tobacco is taxed at 20%, and from 2026 energy drinks are taxed at 15%.

If your business sells something in these categories, don’t operate on intuition: a mistake here isn’t a matter of cents — it’s an entire tax bracket misapplied on every invoice.

IGIC vs. VAT: the difference that matters when invoicing

Beyond the percentage, IGIC and VAT are distinct systems with their own rules on place of supply, deduction, and filing. If you invoice between the Canary Islands and the mainland — or have customers in both territories — the mechanics of which tax applies change depending on the origin and destination of the transaction.

We cover this in full, with numeric examples, in IGIC vs. VAT: complete tax guide for the Canary Islands. If you issue invoices outside the archipelago, that’s required reading before you go further.

What this looks like on a real invoice

Issuing an invoice in the Canary Islands isn’t just applying 7% to everything. Each line can carry its own rate if you sell products from different categories on the same document.

The step-by-step breakdown — which fields are mandatory, how the taxable base is calculated per rate, and the most common mistakes when invoicing in the Canary Islands — is in Invoicing with IGIC in the Canary Islands: a step-by-step guide.

Who files IGIC, and how: form 420

If you’re registered as self-employed or as a business in the Canary Islands and carry out transactions subject to IGIC, you file quarterly on form 420 — the Canary Islands equivalent of mainland Spain’s form 303 (VAT return).

On form 420 you declare the IGIC charged on your sales by rate applied, the deductible IGIC paid on your purchases, and settle the difference. It’s filed quarterly within the deadline set by the Canary Islands Tax Agency taxpayer calendar, with some cases of simplified regime or exemption.

The complete guide to fields, deadlines, and a worked example is in Form 420: the quarterly IGIC guide.

The REF as the underlying framework

All of this — differentiated rates, a general percentage lower than mainland VAT — exists within the REF, the Canary Islands’ distinct tax framework, which also shapes other structures such as the ZEC (Zona Especial Canaria — the Canary Islands Special Zone, a reduced corporate tax regime) and the RIC (Reserva para Inversiones en Canarias — the Canary Islands Investment Reserve, a tax incentive for reinvested profits).

If you run a business in the Canary Islands beyond day-to-day invoicing, understanding the full REF framework changes decisions around corporate structure and tax planning. We cover it in ZEC and RIC: business taxation in the Canary Islands.

The table, summarized

If you take one thing from this article: IGIC is not “Canary VAT at 7%.” It’s a multi-bracket system, and the correct rate depends on the product, not the habit.

Before setting prices or issuing the first invoice for a new product line, confirm the rate. Then automate it so you never have to think about it on every invoice again.