The tax measures approved by the Government to stop the rise in electricity and its impact on the electricity bill have caused a revenue loss of 5,300 million since its implementation last year.
This follows from the monthly tax collection report for the month of May and published this week by the Tax Agency, which includes the impact of the reduction in rates on electricity approved by the Government, which has been extended until the end of of year.
In the first five months of the year alone, the fiscal measures to stop the escalation in the price of electricity led to a reduction in income of 3,695 million, of which 1,520 million correspond to the reduction in tax rates, and 2,175 million, to the suspension of the tax on the value of electricity production.
As explained by the Tax Agency in the report, the significant impact regarding the suspension of the tax on the value of electricity production is due to the fact that the accrual for the first quarter should have been entered in May. As a comparison, the Treasury points out that last year this tax represented revenues of 321 million, and this year, given the wholesale market prices that were recorded in the first months, revenues would have been much higher if the tax had not been abolished. .
As for the reduction in rates, the impact on public accounts in the first five months of the year was 660 million less due to the drop in the VAT rate from 21% to 10% on domestic consumption, and 860 million due to the rate reduction from 5.11% to 0.5% in the special tax on electricity.
At the end of June, the Government approved the extension of the royal decree law of measures to mitigate the economic consequences of the war in Ukraine due to the invasion of Russia, which includes the extension of fiscal measures to lower the electricity bill and incorporates a reduction additional VAT rate of 10% previously approved to 5%.
The new reduction in VAT on electricity is produced under the same terms in which it was in force. In other words, it affects consumers with a contracted power of less than or equal to 10 kW, provided that the arithmetic average price of the wholesale electricity market corresponding to the month prior to the last day of the billing period has exceeded 45 euros per MWh.
According to the Executive, this VAT reduction allows to reduce the bill to 27.7 million households, freelancers and companies and also applies to 72.5% of electricity supply contracts for companies and businesses (non-domestic).
