Spain has begun withdrawing some of the tax relief measures introduced to cushion households and businesses from high energy costs.
From 1 June, the government ended the reduced VAT rates applied to electricity, natural gas, briquettes, pellets and firewood, as well as the temporary cut to the Special Electricity Tax.
The decision marks the start of a gradual rollback of the emergency fiscal measures approved in March to address the economic impact of the war in the Middle East and the pressure it placed on energy markets.
Energy Prices Trigger the Rollback
The government had reduced several energy-related taxes as part of its wider support package. VAT on electricity and natural gas, as well as on briquettes, pellets and firewood, was lowered from 21% to 10%. The Special Electricity Tax was also reduced from 5.11% to 0.5%.
However, the fall in electricity and natural gas prices in April allowed the executive to begin phasing out these measures.
As a result, the reduced VAT treatment and the temporary cut to the Special Electricity Tax no longer apply from 1 June.
The measure linked to the Tax on the Value of Electricity Production will remain in place until 30 June.
Fuel Measures Remain Until the End of June
While relief on household energy bills is being scaled back, tax measures affecting fuels will remain in force until 30 June.
These include reduced rates of the hydrocarbon tax, 10% VAT on petrol, diesel and biofuels, and a partial refund for professional diesel used by eligible sectors.
The extension is intended to maintain support for transport operators, businesses and consumers still exposed to fuel price volatility.
Support for Farmers, Hauliers and Vulnerable Consumers
Sector-specific aid will also remain in place for now. Farmers and hauliers will continue to benefit from targeted support measures designed to offset higher operating costs.
Enhanced discounts under Spain’s social electricity tariff will also remain active. Vulnerable consumers will continue to receive a 42.5% discount, while severely vulnerable consumers will receive a 57.5% discount.
These measures are aimed at protecting lower-income households from renewed pressure on essential energy spending.
Government to Review Measures Before 30 June
The government has said it will continue monitoring energy and fuel prices in the coming weeks. It will also maintain talks with social partners and the sectors most affected by energy costs.
Any decision to extend specific measures beyond 30 June will depend on price developments and the impact on households, businesses and key economic sectors.
For now, the rollback confirms a shift away from broad emergency relief on electricity and gas bills, while maintaining temporary support for fuel, transport, agriculture and vulnerable consumers.
