The First Vice President and Minister of Economy, Trade and Business, Carlos Cuerpo, announced this Thursday that the Executive will initiate in the coming days a round of contacts with social agents and with the sectors most affected by the crisis in the Middle East, in order to specify what support they need once the validity of the first royal decree-law approved to face the consequences of the war in Iran ends in June.
“We will meet with them to see how we continue to support them beyond June, which is when the effect of this first royal decree-law ends, because that is the objective, to continue supporting them as long as necessary,” the head of Economy stated in declarations to the media after a meeting with businesswomen in Malaga.
Measures that have worked
The minister stressed that the latest data from the National Statistics Institute on the Consumer Price Index for April, standing at 3.2%, confirm that the package of measures implemented by the Government is yielding results.
“They are working because without these measures we have seen that the increase in prices would have been around one point higher than that 3.2%,” highlighted the Vice President of the Government.
Cuerpo specified that, in particular, the cost of fuels would have risen by nearly 30% in the absence of the approved measures. Even so, he warned that the war in Iran continues to exert pressure on energy markets and that, therefore, the conditions that justify prolonging specific support for fuels during the month of June remain in place.
As fuel prices for private vehicles have increased by more than 15% year-on-year, the threshold established in the anti-crisis decree, fiscal measures on fuels —reduced rates of the Hydrocarbons Tax, 10% VAT for gasoline, diesel, and biofuels, and partial refund of professional diesel— will continue to be applied until June 30.
Regarding electricity and gas, the Ministry of Economy indicated that a decrease in prices is confirmed for April, which opens the door to progressively withdrawing extraordinary consumer protection mechanisms for these supplies.
Specifically, the Ministry has indicated that the fall in electricity and natural gas prices "allow the deactivation" of the measures relating to the Special Tax on Electricity and the VAT applicable to electricity and natural gas, briquettes, pellets, and firewood, starting from June 1. However, Economy has specified that the measures on the Tax on the Value of Electricity Production will continue until June 30.
The rest of the sectoral instruments, including aid for farmers and transporters, as well as reinforced discounts for the social electricity tariff — of 42.5% for vulnerable consumers and 57.5% for severely vulnerable consumers — will remain in force.
Extension?
Looking ahead to the coming weeks, the Government plans to meet next week with social agents and the most affected sectors to study the extension of the measures beyond June.
"We have to be rigorous in observing the impact we are seeing and, from there, continue to support and protect those sectors, households, or companies that may be most affected," Cuerpo stressed.
Along these lines, the Government's economic official pointed out that, during the six weeks remaining until the end of the deadline for the first royal decree-law, the evolution of the context will be evaluated and it will be decided together with the involved sectors and social agents which support instruments should be maintained.