Spain's value added tax hike from 18% to 21% will take effect on September 1

An increase in the rates of Spain's value added tax will take effect on September 1, Treasury Minister Cristobal Montoro said on Friday.

Prime Minister Mariano Rajoy announced on Wednesday that the general rate would be raised to 21 percent from 18 percent and the reduced rate for the leisure industry to 10 per cent from 8 percent.

"This will come into force on September 1," Montoro said at a press conference after the weekly cabinet meeting. (Reuters)