Two cent reduction on diesel and one cent on petrol
Portugal’s government has announced a minor reduction in fuel prices.
In a statement released this Monday, the Ministry of Finance announced the government will return additional VAT revenue through a discount on the Tax on Petroleum Products (ISP), which will result in an additional reduction of two cents per litre on diesel and one cent on petrol.
“Within the framework of price developments, the government has decided to return the additional VAT revenue, via the ISP, based on the values before the conflict in Ukraine, resulting in an additional reduction of two cents per litre on diesel and one cent per litre on petrol,” the Ministry of Finance announced in a statement on Monday.
According to the government, the total ISP discount so far “amounts to 15.1 cents per litre on diesel and 16.3 cents per litre on petrol”.
In view of the evolution of fuel prices, the government also announced that it is maintaining the partial suspension of the update of the carbon dioxide (CO2) emissions surcharge – the so-called carbon tax.
It pointed out that “taking into account all the measures in force, the reduction in applicable taxes amounts to a total of 25.1 cents per litre of diesel and 26.1 cents per litre of petrol”.
Stating that the measures adopted “aim to reconcile support for families with environmental objectives, within a framework of aligning the level of fuel taxes in Portugal with the eurozone average”, Fernando Medina’s ministry guarantees that it “will continue to regularly assess the evolution of the fuel market, within the framework of measures to mitigate geopolitical shocks [and] the environmental objectives of fuel taxation, and the levels of consumption practised”.
The government noted that fuel consumption in the first eight months of the year “hit a record high for the last decade”, with accumulated year-on-year growth of around 8%, and cites data from the European Commission’s Weekly Oil Bulletin to point out that fuel taxation in Portugal “is below the weighted average for the eurozone: 6% for diesel and 5% for petrol”.
As far as agricultural diesel is concerned, the Ministry of Finance said that the ISP reduction of six cents per litre would continue as part of the measures to support the sector.