- Since January 2023, the measure to prevent the application of VAT to basic foods, where olive oil has been present for three months, has been in force.
The European Commission has warned that tax rules need to be revised, especially as the Euribor index is falling and inflation is 'falling'. He told the Member States that it is time to put an end to extraordinary measures to deal with the crisis and that the Spanish Government is protecting it.
As from 1 October it will be carried out progressively, although the VAT recovery exercise will be carried out. The Value Added Tax on these products has risen from 0% to 2% with the entry in October, and will remain at 2% until the end of the year. By 2025, they will return to what was before, to 4% of the population.
In January 2023, the Government of Spain lowered the VAT on basic food from 4% to 0%. Since then, for example, bread, milk, fruit or vegetables have not had VAT. Olive oil was not included in that list, but in view of the increase that has occurred especially in the last year, the Council of Ministers changed the group last July, so it has only finished three months. From now on, however, it is maintained with basic food, and not in 10% of primary food.
Will olive oil be cheaper?
The liter of olive oil, at the beginning of 2021, had a price of just over three euros. It is currently available for EUR 10. However, according to the National Research Institute (INE), its price is falling at a very low price. He pointed out that in the last four months there has been a decrease of 11%, although the decrease is slowing down, as between July and August almost 2% has been reduced. The price of olive oil has increased by 25.1% over a period of one year.
It is expected that in the coming months there will be even more coverage, because this year’s olive oil, whose harvest is higher and better than last year’s, will soon reach the market.
R02JP045.literalDevAl=VAT restoration, all year round
With the entry in 2024, in Hego Euskal Herria several measures were repealed to deal with the economic crisis. The two related to VAT, electricity and gas respectively. The light receipt increased from 5% to 10%, while the gas was between 10% and 21%.