MADRID, 27 Dic. (EUROPA PRESS) -

The increase in the Value Added Tax (VAT) on electricity from the current 5% to 10%, which will come into force from next January 1, will mean an increase in the cost of the bill of about two euros per month, according to Selectra calculations.

Taking as a reference a home that consumes about 190 kilowatt hours (kWh) at 0.12 euros/kWh - free market price -, the increase in VAT annually would mean an approximate increase of about 25 euros, going from paying about 510 euros annually to 534.29 euros.

In the case of a return of VAT to the 21% it was at before the measures adopted since summer 2021 to deal with the escalation in energy prices, the electricity bill would cost about six euros more per month and would mean about 78 euros per year additional to what is currently paid.

The Government has decided to "gradually" withdraw the tax cuts linked to electricity and natural gas that were in force, in many cases since the summer of 2021, to address the impact on energy prices of the war in Ukraine after the invasion by Russia, as announced by the President of the Executive, Pedro Sánchez.

In this way, the reduction in VAT on electricity - which fell from 21% to the current 5% -, the tax on electricity production - from 7% and currently suspended - and the elimination of the special electricity tax - now at 0.5% compared to 5.1%.

Specifically, in the case of electricity, the Value Added Tax (VAT) will be 10% throughout 2024; The Special Electricity Tax (IEE) will be 2.5% during the first quarter of the year and 3.8% during the second; and the Tax on the Value of the Production of Electrical Energy (IVPEE) will have a rate of 3.5% until March, becoming 5.25% until June, according to the Royal Decree-Law for the extension of several of the temporary measures established to face the energy crisis derived from the war in Ukraine, whose validity expired on December 31.