Rent freeze, energy aid… Spain’s “extraordinary” aid plan in the face of the conflict in the Middle East

Reduction in VAT on gas and fuels, tax suspension… Spanish Prime Minister Pedro Sánchez announced on Friday a series of 80 measures for a budget of five billion euros aimed at combating the effects of the war in the Middle East, promising in particular “a drastic reduction” in energy taxation.

“Extraordinary situations require extraordinary responses,” declared the Socialist Prime Minister after an extraordinary Council of Ministers.

A drop in prices at the pump

Among the measures announced and which will come into force on Saturday, after their publication in the Official Journal, include a reduction in VAT on gas and fuels, which should in particular allow a reduction in prices at the pump of up to 30 euro cents per liter, or “around 20 euros saving per fill-up for an average car”.

The Prime Minister also mentioned a reduction in taxes on electricity by 60%, a suspension of the tax on production, as well as a reduction in VAT on electricity from 21% to 10%.

“Direct aid of 0.20 euros per liter of fuel” will also be granted “to all transporters, farmers, breeders and fishermen in our country, as well as equivalent aid for the purchase of fertilizer,” he added.

He also announced the adoption of another decree providing for a “temporary freeze” of rents in the country, a measure subject to tough negotiation with his partner in government, the far-left Sumar party, and which must still be approved by Parliament.

“Obviously, these measures will not prevent the effects of this illegal war from reaching Spain, but they will at least lessen their impact and make them a little more bearable,” commented Pedro Sánchez.