The Polish government is striving to offer the lowest fuel prices across Europe with its latest decision to slash VAT taxation from 23% to 8% amid the ongoing energy crisis.
This substantial cut was announced by Prime Minister Donald Tusk on August 13, as Polish media reports, with the new regulation to be put into effect starting from next week through to the end of August.
“This is what the Polish people have been waiting for,” Tusk told reporters, saying the measure would help lower fuel prices as the summer holiday season is wrapping up.
The new exemption is expected to reduce prices by up to 1 złoty (approx. €0.23) per litre, depending on the type of fuel.
"Poland will be at the very forefront in Europe when it comes to the lowest fuel prices,” Tusk added.
The measure is part of the government's wider program to tackle the energy crisis under the Lower Fuel Prices program (CPN), which was announced in late March. It was a response to rising global oil prices rose amid tensions between the US, Israel and Iran. The legislation introduced temporary price caps on gasoline and diesel prices at gas stations, as well as reductions in fuel taxes.
“Although fuel prices have temporarily fallen in recent months, allowing market sentiment to stabilise, the current situation requires another intervention,” Poland's finance ministry said in a statement, adding that the CPN program has so far cost the state about 4.7 billion zloty.
While fuel prices have fallen from the peak levels seen in the first months of the crisis, Brent crude was still trading at $87.99 per barrel on August 14, while WTI was at $82.26, which represents more than 20% above pre-war levels in February.
By Nazrin Sadigova
