Pedro Sánchez in parliament this morning. / efe

Spain is to cut IVA tax on electricity bills from 10% to 5%

Prime minister Pedro Sánchez announced this Wednesday morning that the measure will be approved at an extraordinary meeting of the Cabinet on Saturday

MIGUEL ÁNGEL ALFONSO Madrid

Spanish prime minister Pedro Sánchez announced this morning (Wednesday 22 June) that the rate of IVA, Spain's value added tax, on electricity bills is to be reduced from the present 10% to 5%. The measure is due to be approved by the Cabinet at a special meeting on Saturday.

This would save approximately six euros on an average household bill, based on the current price of electricity, which is 155 euros per megawatt hour. It will also make Spain one of the EU countries with the lowest rate of tax on electricity bills, along with Malta (5%) and Greece (6%).

Sánchez attributed the rising cost of living in recent months to the war in Ukraine. The government already put some measures into effect to try to reduce the financial pressure on families and businesses, he pointed out, and said they will continue to do so.