The Government will maintain the measures to alleviate the rise in fuel prices for another month, supporting all consumers through a reduction in the Tax on Petroleum Products (ISP).
In a statement, the Ministry of Finance indicates that the current measures allow the tax burden to be reduced by 28.2 cents per liter for diesel and 32 cents per liter for gasoline. This is the second time that the government has extended the package of measures adopted in May to contain the impact of rising prices, but the extension is for a shorter period of just one month. In July, the measures had been extended for two months.
This extension for a shorter time indicates a reevaluation of the support policy for fuel consumers, which will have two important moments. For next week, the Executive will approve a package of measures to combat the effects of inflation and it will also be in September that the most important lines of the next state budgetwhich will make it necessary to anticipate costs and loss of income in the coming year due to this type of initiative.
Fuels return to pre-war prices. The government can reverse the tax cut, but gradually
This new extension occurs in a context of divergence in the evolution of fuel prices. While gasoline has fallen to its pre-Ukrainian war level, diesel has risen 13 cents in the past two weeks and is already more expensive than gasoline.
The price of diesel exceeds the price of gasoline due to Russia and taxes
The discounts to which the tax on petroleum products refers result from three measures: the reduction of the ISP to replicate in the price the effect of applying a VAT rate of 13% (compared to the 23% set in the community directive), the compensation made in the ISP to the profits of the State in the collection of VAT through the increase in prices before taxes and the freezing of the update of the carbon tax. The ordinance that sets the value of the ISP on diesel and gasoline is in force until September 4.
The ISP discount applicable to colored and marked diesel used in agriculture and fishing will remain unchanged at 6 cents per liter in September, adds Finance.
Source: Observadora
