The Council of Ministers this Wednesday has reversed the main measures that allowed the electricity bill to be reduced, as confirmed by the President of the Government, Pedro Sánchez, in his appearance after the meeting with his Executive. But its dismantling will be done progressively. The VAT on electricity goes from the exceptional 5% at which it has remained during the worst moments of the crisis, to 10% throughout 2024.
The VAT on gas will be recovered in the month of June, although it is likely that it will be done progressively since the president of Sánchez has commented that “it will be reviewed starting in February when the hardest part of the winter has passed.”
Although the cap on price increases for gas in homes and for butane cylinders will continue until the month of June, which will remain at 19.55 euros. Establishes reduced taxation for electricity, natural gas and biomass fuels used for heating
The Executive will also “progressively recover” the Special Tax on Electricity that was reduced to 0.5%, the minimum that Brussels has allowed, and which is set at 2.5% during the first semester and will rise to 3 .8% from June. Although he has not commented on when he will recover 5.11%.
Along the same lines, it recovers the Tax on the Value of the Production of Electrical Energy (IVPEE) of 7% despite the fact that the energy sector had requested its definitive suspension for reducing its competitiveness compared to the European industry.
Sánchez has justified these measures “because the figures speak for themselves.” The president recalled that before the outbreak of the war in Ukraine the price of electricity exceeded 360 euros per MWh and last week “it had dropped seven times, to 51.8 euros MWh”, he pointed out, although not without highlighting that the “uncertainties have not ended.”
Outside the energy framework, the Government reinforces its commitment to “social justice” without this “coming into conflict with economic growth,” stressed the president who has announced that the VAT reduction will be maintained at 0% for basic foods and 5%, for pastas and oils. As well as the maximum discount of the social bonus for vulnerable families and evictions and releases for vulnerable households without a housing alternative will continue to be prohibited.
The President of the Government also wanted to include in this aid package the revaluation of pensions to adapt them to the cost of living. Specifically, by 2024 this revaluation of contributory pensions will be 3.8%. “Leaving for history the 0.5% that rose in the years of the PP” recalled the president.
The package of measures also contemplates the elimination of bank commissions for withdrawing cash for older people and those who have some type of disability, as well as the transfer of the Minimum Living Income to the autonomous communities that request it.
In relation to public transport, Sánchez has announced that aid will be maintained as before throughout the year. Therefore, during 2024, the free Cercanías, Rodalies and Media Distancia services will be extended for frequent users, and the General Administration will continue to contribute 30% to reduce urban and interurban means of transport, aid conditional on the communities Self-employed help with an additional 20%.
On the financial side, mortgage aid will continue to be in force for families with incomes of up to 37,800 euros. That shield for shield that was expected to be used by around 100,000 families and that has been requested so far by only 7,000. Among other things, as La Vanguardia explained, because outside of this public shield the bank is collaborating directly in the refinancing of mortgages and the owners benefit and will benefit from the suspension of all early amortization commissions for variable-rate mortgage loans. fixed and conversions from variable type to mixed type will also be included.
