New change in fuel tax rate reduces the price by around 16 cents

The Prime Minister has announced that this Friday, April 8th, a new package of measures aimed at containing fuel prices will come in to play, which includes the reduction of the ISP fee (tax on petroleum products), applying the intermediate VAT rate (13%) to fuel prices, instead of the 23% rate.

The change to the VAT rate on fuel from 23% to 13% translates into a reduction of around 16 cents per litre on gasoline and diesel, according to today’s average prices.

“While we have not received a response to our request from the European Commission, we will proceed from now on with a reduction of the ISP equivalent to the reduction of VAT to 13%”, announced the Prime Minister.

According to data from the National Entity for the Energy Sector (ENSE), the selling price to the public (PVP) as of yesterday, April 7th, for a litre of simple gasoline was 2,030 euros and 1,981 euros for simple diesel.

Applying the intermediate rate of 13% VAT to today’s PVP would cause the price per litre to fall by 16.5 cents for gasoline and 16.1 cents for diesel, a solution that Portugal will adopt for now, as there is still no authorisation from Brussels for Member States to apply VAT rates lower than normal to fuels.