Spanish VAT assessments shouldn’t impact Spain’s bottom-line

The EUR was sold off during the NY session on news that the Spanish government will have to re-pay EUR5 billion in VAT which it falsely assessed.

My understanding is that this is a technical issue based on the time-frames on which the tax was assessed and even though the Spanish Tax office will be giving back the EUR5 billion, it will then be re-claiming it based on different timeframes. Therefore the net effect on the Spanish coffers will be zero, just a lot of time wasted which is fine as that’s what bureaucrats do anyway.