Government calls halt on rising fuel costs

Faced with the threat of a truckers’ strike over rising fuel costs, the government has reduced its ‘tax grab’ on the price of every litre, meaning both petrol and diesel have come down in price overnight.

The reduction of two cents per litre for petrol, and one cent for diesel may head off industrial action by truckers’ syndicates. It is too soon to tell.

Announcing the move yesterday, under secretary of state for fiscal affairs António Mendonça Mendes said the government is effectively saying goodbye to what would have been €90 million in revenue.

The idea is to maintain this tax amnesty until the end of January 2022.

But with what has become a global energy crisis, President Marcelo has already warned that further price increases (beyond the governnment’s control) could compromise Portugal’s economic recovery. As it is, the 36th increase in the price of fuel this year has already seen many businesses warn that they face bankruptcy.

ANTRAM, the national association representing public and merchandise transport, has ‘welcomed’ the demonstration that the government “is aware of the dramatic situation in which many businesses find themselves” but doubts the impact of the decision, which in the end is a tiny reduction in overall costs, will make any difference.

Next week is likely to bring further updates.

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