It will extend the VAT reduction on basic foods and aid for public transport

MADRID, 27 Jun. (EUROPA PRESS) -

The Council of Ministers will approve a Royal Decree-law on Tuesday to extend some of the measures to deal with the economic consequences of the war in Ukraine and the rise in prices that expire on June 30.

Specifically, as announced yesterday by the President of the Government, Pedro Sánchez, the VAT reduction on basic foods and aid for public transport will be extended.

Likewise, Sánchez announced the approval in the Council of Ministers this Tuesday of a 15% deduction in Personal Income Tax (IRPF) for the purchase of electric vehicles that "incentivize the green transition" until the 31st of December.

"The reduction in VAT on food, the subscription to public transport and all those social elements that I said from the beginning of the war and that will always be on the table will be extended," confirmed last night the president in an interview on Cadena Ser collected by Europa Press.

Sánchez stated that "some new elements" will be incorporated that have to do with the "economic and social response" and the consequences of the war in Ukraine and "others that have to do with measures that were either agreed with Brussels and have to be approved , or they are political commitments of the Government of Spain". In fact, in that same Royal Decree-law the right to be forgotten oncology will be included.

Some of the anti-crisis and anti-inflation measures approved by the Government last December had an expiration date of June 30.

In the absence of the Plenary of Congress as a consequence of the dissolution of the Cortes due to the electoral advance, it is the Permanent Deputation, the only body that remains standing, who will assume the power to validate or repeal the measures that the Government adopts this Tuesday by decree law .

Among the aids that expire on June 30 and that will be extended this Tuesday is the reduction in the price of passes and multi-trip tickets for public transport (not the Renfe suburban and medium-distance discount, which is maintained throughout the year). .

It should be remembered that the Government subsidized public transport of the rest of the administrations with 30% as long as they promised to increase this discount to 50%, a measure in force until June 30.

The Executive will have to decide whether to maintain the discount of 20 cents per liter on fuel for the professional road transport sector or aid to the autonomous communities and town halls for gasoline for public buses.

In terms of energy, it must decide whether or not to extend the VAT reduction on the electricity bill from 10% to 5% applied to consumers, companies or individuals, with a contracted power of up to 10 kilowatts. This also includes the reduction of the VAT rate applied to the receipt of natural gas from 21% to 5%.

The extension of the temporary suspension of the Tax on the value of the production of electrical energy also ends on June 30, while the application of the tax rate of 0.5% of the Special Tax on Electricity will be extended until December 31 of this year.

Likewise, the Government must decide whether to end the 80% reduction in tolls in the electro-intensive industry; VAT at 4% for masks and 0% for goods and benefits to combat Covid; and the limitation to the maximum price in the butane bottle. Another issue is whether or not the objective cause for dismissal is renewed in companies that have benefited from some aid due to the increase in energy costs.

In addition, if there are no changes, in July the extraordinary extension of the habitual residence lease contracts will conclude, the procedures and launches will be allowed again and the negotiated procedures without publicity will be suspended. Through the latter procedure, public buyers were allowed to purchase supplies and services in the shortest possible time.

The exemption for the owner of the fishing vessel or vessel and its substitute is also pending review, provided that the fresh catch enters the port by sea. The same occurs with the extension of ERTEs in companies and workers in the Canary Islands affected by the La Palma volcano.