With talk of fuel prices likely to rise by 10 cents at the pumps next week – as a direct result of the United States/ Israeli attacks on Iran (and the subsequent escalating conflict) – prime minister Luís Montenegro has pledged that his government will bring in ‘an extraordinary and temporary’ discount on the ISP tax on fuel (which Brussels’ recently insisted must be restored in full).
Answering questions in the fortnightly debate in parliament this afternoon, Mr Montenegro was responding to a specific question from PS Socialists about the ‘economic consequences’ of the conflict that is now approaching its 6th day.
“Given the guidance provided to various members of the government not to downplay the effects that the conflict may have on our economic dynamics, we are in a position to say that one of these effects could be an increase in fuel prices,” he began. If this happens – and if it happens to the level of 10 cents already predicted – “the government will introduce an extraordinary and temporary discount on the ISP to compensate the additional (revenue it will be receiving) in IVA (VAT). This way we will be returning all this additional (revenue) to the Portuguese people and companies.”
SIC Notícias stresses that the “real economic impact” of this conflict on Portugal and Europe in general “is difficult to predict and will depend overall on how long it lasts”.
For the time being the major preoccupation in Europe is not fuel, it is gas (given that Europe is heavily reliant on gas from Qatar, which has closed down production following a drone attack).
Consumer watchdog DECO meantime has warned that everything that is happening will see prices generally increase across the board, and inflation rise beyond its current 2% mark.
Sources: SIC Notícias
