The Spanish government has unveiled a €3bn package to help vulnerable households cope with soaring energy prices, notably by increasing the amount of discounted energy by 15% as well as increasing the rebate on power tariffs for “vulnerable” and “severely vulnerable” households to 65% and 80% respectively. In addition, a 40% discount on low-income workers’ power bills will be implement. In addition, the thermal social bonus budget will be doubled in 2022 and 2023, raising the minimum aid to €40. The country will raise the heating subsidy granted to vulnerable households which will now be able to claim up to €375/year for heating costs. The measures are expected to benefit 40% of Spanish households.
In October 2022, the authorities lowered value-added tax (VAT) on gas to 5% from 21% from October 2022 until at least December 2022 to reduce the effect of rising international price on household utility bills. Spain has already cut the VAT on electricity twice over the past year; however, this is the country’s first VAT reduction on gas.
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