supermarket basked with food

0% IVA on basket of 46 foodstuffs in force as of today

Supermarkets have 15 days to reflect changes; ALDI has already started

The measure that exempts a basket of 46 foodstuffs considered essential from IVA (VAT) comes into force today, with food retailers having 15 days to reflect this exemption in retail prices.

The list of food products exempted – following a tripartite pact signed between the government and the food production and distribution sectors – includes vegetables, fresh, chilled and frozen meat and fish, as well as rice and pasta, cheeses, milk, dairy based and vegetable based yogurts, vegetable based beverages, fruit (apples, pears, oranges, bananas and melons) and three types of pulses.

The products were chosen taking into account the healthy diet basket of the ministry of health and data from distribution companies on products most consumed by the Portuguese.

This measure, which aims to combat the effects of food prices on household income, will be in force until the end of October, with the government estimating that it will contribute 0. 2% in reducing inflation this year

Despite food retailers having up to 15 days to reflect in the sale price to consumers the reduction from 6% to 0% in the IVA rate on that basket of 46 products, there are chains that have already started to announce they will apply the measure as of the day it comes into force – namely supermarket chain Aldi.

In a statement sent to Lusa news agency, Aldi said “the final PVP [Retail Price without VAT] will be visible through special price tags, with the indication – “article IVA 0%” – so that customers can “easily identify these products on the shelves, as well as the final price to pay, avoiding additional calculations and thus simplifying their shopping experience.

“After payment, the customer can confirm the IVA applied to each product on the respective receipt,” adds the German chain, which says it intends to implement the measure “in a clear and transparent way”.

Asked about the measure at the end of yesterday’s extraordinary meeting of the Council of Ministers, Prime Minister António Costa said he hoped everyone will do their bit, referring to the pact signed between the government, the Portuguese Association of Distribution Companies (APED) and the Confederation of Portuguese Farmers (CAP).

“We all have to do our part”, he said.