Spain to reduce VAT on fuel to 10%

Spain on Friday will reduce the value-added tax on fuel products to 10% from 21% as part of measures to cushion the economic blow from the Middle East conflict, citing sources familiar with the plans.



Madrid also plans to suspend the excise duty on hydrocarbons, which would lead to an immediate reduction in the price of diesel and petrol of between $0.35-$0.46) per litre.



The government will eliminate a 5% tax on electricity consumption, according to the report.



A government spokesperson declined to comment ahead of the press conference announcing the measures, set for 1100 local time.



Ministers said earlier this week the measures will include aid for economic sectors most exposed to the crisis, but added that the country's high generation of renewable energy meant its economy was less exposed to the impact of oil price spikes caused by the war.