The reduction of the VAT on electricity to 6% on some consumptions means an average saving of 1.60 euros per month for Portuguese families. According to Deco and the association representing energy traders in the liberalized market (ACEMEL), these figures show that the measure announced by the government is insufficient to mitigate the escalation in the price of electricity and gas and the increase in costs for the Portuguese in the light of inflation.
Unlike, for example, Spain and Germany, the Executive led by António Costa did not progress with the general reduction of the tax burden on energy. The proposal presented by the Prime Minister on Monday focuses only on the part of the bill on which 13% VAT is applied, which corresponds to the first 100 kWh consumed monthly (150 kWh for large families) in powers of up to 6. 9 kVA. It thus disregards the consumption currently taxed at 23%. According to data provided to Dinheiro Vivo/DN by the Energy Services Regulatory Authority (ERSE), the measure affects 5.3 million contracts.
According to the accounts of Deco Proteste, this measure, which will shortly be presented to the Assembly of the Republic to enter into force on October 1, translates in practice into only a monthly saving of 1.08 euros and 1.62 euros for large families. , which fall far short of the expectations raised by most consumers,” according to the Consumer Protection Association, which is why it defends the application of the minimum VAT rate (6%) to all consumers and to all household energy.
ACEMEL’s calculations, which are based on the consumption profile of a couple with two children with a contracted power of 6.9 kVA, also indicate a saving of the same value: 1.60 euros. This discount “represents a discount of less than 2% compared to the current situation”, the representative of energy traders warns.
Given this scenario, and despite the “residual benefit” that this measure will bring to most households, Deco Proteste regrets that the VAT reduction that should be in effect until December 2023 does not apply to all electricity and gas consumption, but to approximately part of the electricity consumption. And he believes that at a time when there is so much demand for the electrification of consumption, including support programs, “this measure exposes a clear inconsistency of the state, which defends neither the environment nor energy efficiency”.
A position similar to ACEMEL, which it takes advantage of to highlight the impact of the tax discrepancy between Portugal and neighboring Spain. “Since we are part of an Iberian market, it should be noted that Spain has reduced VAT on electricity to 5% since June” and “had already reduced the maximum rate to the intermediate rate of 10% in 2021”, he stressed. .
Iberian ceiling taxed at 23%
Another point raised by Deco in support of the fact that the measure is not sufficient to mitigate the increase in household costs is related to the Iberian ceiling on the price of gas for electricity production. Due to the recently created Iberian energy price control mechanism, electricity bills for contracts signed or renewed after April 26 now include an additional term, which is also subject to VAT at the maximum rate of 23%. Looking at the average prices in August, Deco Proteste concludes that this extra advance costs an average of EUR 15.32 more on the electricity bill, to which EUR 3.52 VAT is added. “From this it can easily be concluded that the Portuguese will not really feel relief from their electricity bill. The extra part charged on each bill will in fact be much higher than the small reduction that the now announced measure will bring to the household budget”, strengthened the Association.
The reduction in VAT on gas was not included in the package of measures to support households. Because? “The government was looking for the solution that guarantees the lowest price for families”, defended the Environment Minister when presenting the package of support measures, referring to the already announced proposal to return to the regulated natural gas market from 1 October. According to the government, this solution will enable savings of up to 10% for the current 1.3 million consumers of natural gas through pipelines who choose to switch to regulated gas. And according to Duarte Cordeiro, the savings can be as high as 60% compared to the supplier with the most customers, EDP.
Source: DN
