Poland temporarily cuts fuel VAT to 8% for holiday relief

Poland is implementing a temporary reduction in the value-added tax (VAT) on gasoline and diesel fuel, lowering the rate from 23% to 8%. This measure will be in effect from Monday until August 31st, aligning with the conclusion of the Polish school holidays.

Prime Minister Donald Tusk announced the decision, stating that the tax cut aims to provide financial relief to consumers, particularly those returning from vacations. In addition to the VAT reduction, the Energy Minister will establish a daily maximum retail price for fuel. This price will be determined based on average wholesale prices and the operating costs of major suppliers.

Tusk indicated that these combined measures are expected to decrease the price of diesel and gasoline by approximately 23 cents per liter. As of Thursday, the average price for a liter of regular gasoline in Poland was around 1.66 euros, while diesel was approximately 1.88 euros per liter, according to industry observers.

This move marks a partial return to a fuel price package previously introduced by the government in response to rising fuel costs after the start of the Iran war. That earlier package, effective from late March to the end of June, included not only a reduced VAT rate but also allowed the Energy Minister to lower the excise tax on fuel. The current initiative aims to ease the financial burden on consumers during the peak travel season.

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This should bring consumers financial relief, especially when returning from vacation.