This Monday, the VAT applied to the electricity and gas bill will rise again to 21% from 10%, where it had been since mid-March, when the government approved various measures to contain the energy price escalation resulting from the Iran war; while the special electricity tax will return to 5.11% compared to 0.5% in recent weeks. The reason is that electricity and gas prices have remained below the levels forecast by the government, so the Executive is advancing the withdrawal of these reductions by one month, which were initially planned until June 30.
In the royal decree-law responding to the crisis in the Middle East, the government had established a deactivation clause for the measures that stipulated that if the CPI for fuels, electricity and gas in April was 15% above the CPI for those components in April 2025, the tax measures would remain in force. Otherwise, they would be deactivated. And that is what has happened because electricity and natural gas maintained negative year-on-year rates in April, with a drop of -4.3% for the former and -9.6% for the latter.
However, the suspension of the 7% tax on the Value of Electricity Production remains until June 30. This tax is levied on electricity generators, but they pass it on to their offers, so the wholesale price increases.
According to calculations by the electricity price comparison platform Selectra, the withdrawal of these reductions will mean an increase of 8 euros in the next electricity bill for a consumer in the free market - who has a fixed price for the energy term - increasing from a cost of 56.32 euros to 64.78 at the end of the month. In the case of regulated market consumers, the return of taxes will mean an increase of about 2 euros (from 49.42 euros to 51.54 euros).
Fuels maintain the reduction
The tax reductions on fuels remain, at least until June 30. Specifically, the VAT on fuels is currently set at 10%, while the special hydrocarbon tax remains at the minimum allowed by the European Commission (0.359 euros per liter for gasoline, compared to the previous 0.473 euros per liter, and 0.330 euros per liter for diesel, compared to the previous 0.379 euros before these measures).
The National Commission of Markets and Competition (CNMC), responsible for supervising that the network of more than 10,500 service stations on the mainland have generally passed on this reduction, has concluded that most service stations have complied, although it has detected anomalies in some gas stations, according to a report published by the agency last Friday.
Also remaining in force are the aid to farmers and transporters, as well as the reinforced discounts of the social electricity bonus, which suppose a reduction in the electricity bill of 42.5% for vulnerable consumers and 57.5% for the severely vulnerable.
