Poland's Prime Minister Donald Tusk announced on Thursday that the government in Warsaw will reduce VAT on fuels and cut excise duty to the minimum allowed by EU rules, and retailers will have a maximum selling price ceiling, Reuters and TVP World wrote.
According to the Polish Prime Minister, the value added tax will be reduced to 8%, from 23%, in the case of fuels, while the excise duty will be reduced to the level of 0.068 euros per liter of gasoline, respectively 0.066 euros per liter of diesel.
In addition, the Polish authorities are working on a tax on the extraordinary profits of oil companies, Donald Tusk also stated in the press conference held before the government meeting on Thursday.
“Just before the holidays, we should see a price drop of around 1.2 zlotys (0.28 euros) per liter for all fuels,” Tusk said.
“We want this reduction to have a real impact on prices, not to line the pockets of those involved in the fuel trade,” he added. “For the period of application of these reductions in VAT and excise duties, we will introduce a maximum retail price for fuel,” Donald Tusk also said.
The Polish government does not rule out possible measures against foreign drivers
If necessary, Tusk promised, Poland will take measures to prevent foreign drivers from taking advantage of the price cuts. The head of the government in Warsaw mentioned that the system in Slovakia, where cars with foreign license plates pay more at gas stations than local vehicles, will be analyzed.
“We will not hesitate to use such tools if necessary,” the Polish leader said. “We will monitor these few days to see if the scale warrants such actions,” he explained.
In Poland, taxes account for over 40% of pump prices.
Shares in state-owned refiner Orlen were down 6 percent after the Polish government's announcement.
