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FAI discount reduced in December as fuel prices drop

In a press release, the supervisory authority recalls that, as announced, "the mechanism applicable in the FAI is equivalent to a reduction in the VAT rate from 23% to 13% and the compensation mechanism via the FAI for the reduction of additional VAT revenue, resulting fuel price changes, remain in effect.

Thus, taking into account the evolution of the price of diesel and gasoline, "these temporary measures result in a reduction of the FAI rebate of 3,9 centimes per liter of diesel and 2,4 centimes per liter of essence. This maintains a rebate of 17,1 cents per liter on FAI for diesel and 15,4 cents per liter on FAI for gasoline,” the same memo read.

On the other hand, "the update of the carbon tax will remain suspended until the end of the year", and "taking into account all the measures in force, the reduction in the tax burden is 27,3 centimes per liter of diesel and 24,7 centimes per liter of petrol". .

The mechanism applied by the Government for rebates implies that a fall in the price of fuel leads to an increase in the Tax on Petroleum Products (ISP), due to the fall in VAT revenue.

“The fuel price hike mitigation measures remain in effect for the month of December, with the government continuing to support all consumers through a reduction in fuel taxes,” the ministry said.

The FAI rebate equivalent to the 13% reduction in the VAT rate was due to run until September 4, but was later extended until the end of the year, as part of the government's aid program for families in due to rising prices.

Average fuel prices have returned this week to lower values ​​than those practiced before the war in Ukraine, on February 24, with drops of 5,1% for gasoline and 4,1% for diesel calculated by the 'ERSE.

According to the “Weekly report on the monitoring of retail prices” published Monday evening by the Entidade Reguladora dos Serviços Energéticos (ERSE), “for the week of December 28 to 4, the effective price before taxes is 0,860 euro/ l [euros por litro] for pure 95 petrol and 1,067 Euro/l for pure diesel", i.e., after taxes, 1,660 Euro/l and 1,685 Euro/l for pure 95 petrol and pure diesel, respectively.

These values ​​are to be compared to the average prices of 1 euros/l for pure gasoline 816 and 95 euros/l for pure diesel invoiced on February 1, when the Russians invaded Ukraine, according to data from the Directorate General for Energy and Geology (DGEG).

ALYN (LT/JF/PD) // MSF

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