Poland to reduce fuel VAT, cap prices from Aug. 17
Government to lower VAT on gasoline and diesel while imposing temporary price ceilings to ease consumer costs amid inflation pressures.
Poland will reduce value-added tax on gasoline and diesel to 8% from 23% starting August 17, the finance ministry announced on Thursday.
The government will also introduce temporary price caps on fuel at retail stations to prevent excessive surcharges during the transition. The measures aim to mitigate the impact of high energy costs on households and businesses.
The VAT cut applies to both unleaded 95 and 98 octane gasoline, as well as diesel. The price caps will be set at levels determined by the energy ministry in consultation with industry representatives.
The policy follows recent increases in global oil prices, which have pushed domestic fuel costs higher despite a government fuel subsidy program introduced last year. The temporary measures will remain in effect until December 31, unless extended.
Analysts noted that while the VAT reduction will lower prices at the pump, the price caps may limit supply incentives for refiners and distributors. Poland’s inflation rate stood at 10.8% in June, driven in part by elevated energy prices.
The government has not disclosed the exact price ceiling levels but stated they would be adjusted periodically based on market conditions.
Elena covers macroeconomic data and policy across the eurozone, translating industrial output, inflation and growth figures into what they mean for markets.
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