This staple foods It will be sold without VAT until at least 1 November and if inflation continues, the tax reduction will continue until the end of the year. The government has made it official this Tuesday that it will keep the measure in effect (this includes Tax deduction on oil and paste Halves in principle from 10% to 5% by 31 December, but determines that the tax cut will be repealed on 1 November if the September data for so-called core inflation are below 5.5%. These data will be known in October National Institute of Statistics (INE) Publish data for September; Therefore, the possible cancellation of the tax cut will take effect from 1 November. For reference, core inflation (which excludes the more volatile prices of unprocessed food and energy) was 6.1% in May, just six-tenths above the limit.
According to government calculations, with this extension for the second half of 2023, the savings for families will be 661 million, as in the first half of the year. In other words, the total budget impact would be 1,320 million.
The extension of the VAT reduction on food is part of a royal decree approved by the Cabinet this Friday, giving the green light to its seventh. Shock plan approved by the Government to mitigate the effects of war and inflation in Ukraine, The estimated budgetary cost is 3,800 million Euros.
“What we’ve done this first time of the year, VAT discount depending on how prices develop or conditional food prices and the line we have to follow in general, measures that adapt as automatically as possible to how the economy is responding” First Deputy Head of Government and Minister of Economic Affairs, Nadia Kalvino, in an interview at RNE. “We believe that [la rebaja del IVA] “It should be sustained, but it always depends on how prices will evolve in the coming months.”
In any case, what is clear is that until then, as staple foods bread, Fame, milk, cheeses or eggsBesides the fruit, vegetables, vegetables, legumes, tubers And cereals In the status of natural product to be sold without VAT; and that oil And pasta It will be sold at 5%.
Nevertheless, consumer association face It didn’t take long to criticize this gesture: The party regrets that the Government has “limited itself to extending the VAT reduction on basic foodstuffs without carrying out checks on the suitability of the measure during the six months it has been in effect”. The move has failed to bring the price of food down, according to its data and multiple balance sheets, and in fact, food prices are almost 12% more expensive than they were a year ago.