The fourth vice president of the Government and minister for the Ecological Transition and the Demographic Challenge, Teresa Ribera, has assured that the Government will review the electricity taxation “soon“, with the aim of cushioning the impact on the bill of high electricity prices.
In statements to RNE collected by Europa Press, Ribera pointed out that the Executive’s intention is that this revision of electricity taxation “arrives as soon as possible”, although it did not specify if it will be in the next Council of Ministers “or another day”. “Yes it will be very soon,” he said.
In this regard, the minister pointed out that the Ministry of Finance is studying “all the alternatives” to undertake that eventual intervention in electricity taxation that reduces the electricity bill to citizens, including a reduction in VAT or its modulation by consumption segments.
Ribera indicated that the Treasury is the competent Ministry in this matter, regardless of whether its Department or the Ministry of Consumption of Alberto Garzon are making contributions.
“We are looking at all the alternatives, including the intervention or modulation models of each of the fiscal figures and the indirect imposition of VAT. Therefore, it is important to see if the general rate is reduced, if it is done in sections or if it is temporarily excluded. Any modification of the VAT must be communicated to Brussels. I ask for patience, we will soon have a proposal from the competent Ministry, “he said.
In any case, regardless of whether a temporary intervention is undertaken to lower the electricity bill, Ribera assured that his Department is working with the Treasury on a “thorough review” of electricity taxation, although he insisted on asking “calm and patience”.
“We are working with the team of Hacienda because it is important to find out what are the structural causes of the rise in electricity, how a fairer distribution of costs can be made and how it can be guaranteed that consumers are not the ones who with their bill pay a very notable increase in business profits. Taxation deserves a thorough review to give the correct signals, “he explained.
“This requires peace of mind and doing it right (…) It is important to be careful. The Treasury is seeing in detail all the variety of fiscal elements that appear in the invoice, including VAT, but you have to be a little patient, “he insisted.
In the case of a new temporary deletion of the 7% tax Regarding electricity generation, as it already happened in 2018, Ribera considered that it is one of the elements to study “in an overall reform” and pointed out that if it was addressed it would be “provisionally”.
However, he assured that “It would be of little use to reduce the taxation on the electrical part and transfer it to the PGE, since taxpayers would be the ones that would continue to pay, it would be a bit of a trileros game (…) The important thing is to see how much of that increase goes to company profits, “he added.
In addition, he recalled other measures that the Government has addressed in parallel, such as the National Fund for the Sustainability of the Electricity System (FNSSE) or the reduction of the CO2 dividend aimed at this reorganization of the electricity market, underlining that in any case “we must be careful with the reforms of the electricity market that must be compatible with the European framework.”
In the specific case of reduction of the CO2 dividend, For which a cut of about 1,000 million per year is expected to be applied to electricity companies, he indicated that the objective is for the draft bill to be sent, after its public consultation period, to the Congress of Deputies “before the summer holidays. .
In addition, Ribera stressed that what he produces “a notable increase” in the bill “It’s the very high cost” of fossil fuels and how they determine the price of electricity. “We must get out of fossil fuels as soon as possible,” he said.
Eddie is an Australian news reporter with over 9 years in the industry and has published on Forbes and tech crunch.