The Council of Ministers has approved this Tuesday a new package of anti-crisis measures to alleviate the economic problems derived from the increase in inflation and the consequences of the war in Ukraine.
The most striking decision taken by the Executive of Pedro Sánchez has been to abolish VAT for six months (from 4 to 0%) for basic foods such as bread, bread-making flour, milk, cheese, eggs, fruits, vegetables, vegetables, legumes, potatoes and cereals.
Within this same package, oils and pasta will also see their Value Added Tax reduced, although in this case the drop goes from 10 to 5 percent. VAT on food in Spain varies between the reduced rate (10%) and the super-reduced rate (4%). However, there are certain foods, such as sugary or alcoholic beverages, to which the general rate of 21% is applied.
In addition, the price of urban and interurban public transport is lowered by 30% in the territories where the regional and municipal administrations supplement it up to 50%. This measure is added to the free Suburban, Rodalies and Medium Distance Renfe season tickets during 2023.
On the other hand, the Government has approved aid of 200 euros for 4.2 million families with annual incomes of up to 27,000 euros and an extension for six months of the reduction in taxes on electricity and gas, freezing the maximum price of butane cylinder.
The 2% limit on the annual rent update is also extended until December 31, and the suspension of evictions and releases for vulnerable households is postponed for six months.
The Executive has prohibited the cutting of essential supplies throughout 2023, while the social bonus is extended. In addition, the 15% increase in the minimum vital income and non-contributory pensions is maintained.
Another of the approved packages includes 300 million in direct aid to farmers, to offset the increase in costs due to the increase in the cost of fertilizers and the discount on fuel for professional road transport, farmers, shipping companies and fishermen.
The extension of the discount of 20 cents per liter for professional road transport will be paid at the end of each month. For farmers, direct aid of up to 20 cents per liter will be made through the refund of the special hydrocarbons tax, at a cost of 240 million.
The Council of Ministers has given the green light to allocate 120 million in direct aid for fishermen and support for the gas-intensive industry with a new ICO liquidity line of 500 million euros and 450 million euros in aid for the energy sector ceramics and other subsectors. In addition, 3,100 million public investment is expected through the new PERTE for industrial decarbonization
In order to continue recruiting physicians and reinforce primary care services, the Spanish Government has approved enhanced active retirement, which will allow health professionals, family doctors and paediatricians of retirement age to continue for the next 3 years.
These workers will make 75% of their pension compatible with full-time or part-time active service. In addition, 8.5% of pensions will be revalued in 2023, in accordance with the increase in inflation, guaranteeing the purchasing power of retirees.
