HOUSEHOLDS across Spain are set to face a 15% hike in their energy bills as a government relief package expires on June 1.
Electricity and gas costs will rise by an average of €16 per month as two energy taxes, known in Spain as IVA and IEE, return to their standard rates of 21% and 5.11% respectively.
The Spanish government cut IVA – the equivalent of VAT in Britain – and IEE, a special tax on electricity, to 10% and 0.5% on March 22 as the fallout from the Iran war sent global oil prices soaring.
The move was designed to shield consumers from a spiralling energy crisis that saw EU energy prices rise by nearly 5% year-on-year in March, according to Eurostat data.
Although the measures were initially due to remain in place until June 30, the government decided to end them early after inflation fell by more than 4% year-on-year in April, triggering a return to pre-relief tax rates.
The only exception is fuel, which will continue to benefit from an 11% VAT reduction until at least the end of the month, authorities said.
As a result, petrol and diesel prices are expected to remain between 25 and 30 cents cheaper per litre while VAT stays capped at 10%.
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According to data published by Spain’s National Statistics Institute (INE), electricity prices fell by 4.3% year-on-year in April, while natural gas prices dropped by 9.6%, prompting the automatic withdrawal of the tax cuts from June 1.
Industry estimates suggest the temporary reductions had been saving households around €8 per month on both electricity and gas bills.
The increase is expected to be felt most noticeably in June and July, when higher summer electricity consumption typically pushes up household energy use.
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