Government puts up fuel and tobacco prices

MADRID
CENTRAL Government will this week put the price of petrol and cigarettes up.
Spain's second vice-president and Economy Minister, Elena Salgado has said that the price of fuel is going to rise by 2.9 cents per litre but the increase will not affect professional users.

The increase in the price of cigarettes means that packets which currently cost 2 euros 65 cents, are going to cost 2.84.
The more expensive brands which currently cost 3 euros 10 cents for a packet of 20 cigarettes, are going to cost 3.29 She was asked if income tax levels and other levies were going to be put up in next years budget but refusing to be drawn, Salgado replied: “we are going to take a look at a lot of figures, those related to spending as well as income.” Once the newly approved law on fuel and tobacco price rises has been made official, tax on diesel will go up by 10.4 percent, the equivalent of 0.307 euros per litre.

With this, the new average price of petrol will be around 1.03 euros whilst that of diesel will go up to 91 cents per litre, said the Minister.
The hike does not affect costs for people who use fuel in the professional sector such as agriculturists, nor that which is used for heating such as natural gas or kerosene. Currently, companies which transport passengers or goods have been entitled to a refund of tax on fuel since the beginning of 2007. Salgado pointed out that fuel in Spain is still cheaper, even after the planned hikes, than it is in France (1.23 euros) and Portugal (1.273 euros).

In her view, keeping a lid on the use of fuel contributes not only to a sustainable environment but also allows funds, through taxation to be redirected to the national government's social programme.