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Friday, January 21, 2022

Fuel prices. Ministry of Climate and Environment on reducing excise duty rates

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Petrol prices at gas stations have already exceeded PLN 6 per liter – noted Anna Wojciechowska from the Civic Coalition. Therefore, the deputy addressed a parliamentary question to Prime Minister Mateusz Morawiecki, in which she asked if the government was planning to reduce the excise tax on fuels. There is an answer from the Ministry of Climate and Environment.

Anna Wojciechowska from the Civic Coalition recalled in a parliamentary interpellation about the 2011 election spot for Law and Justice. “In the 2011 Law and Justice campaign, we heard: ‘They must have gone crazy ?! Do you know that petrol is already PLN 5.40 ?!’, and Jarosław Kaczyński added: ‘More than half of the price of petrol is taxes. I would reduce the excise tax, which would reduce gasoline prices. But for that you need courage and responsibility, “we read in the interpellation.

“Today, gasoline prices at gas stations have already exceeded the amount of PLN 6 per liter, therefore the current government has the opportunity to fulfill this election promise” – added Wojciechowska. Therefore, the KO MP asked whether the rulers would fulfill the above-mentioned election promise of 2011, and if so, what measures would be taken to curb and lower the rising fuel prices.


Fuel prices in Poland

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The answer to the question was provided by the Deputy Minister of Climate and Environment. was given by Piotr Dziadzio. As he explained, retail fuel prices belong to the category of contractual prices, i.e. prices determined by producers based on market mechanisms. “This means that the government has no direct influence on shaping their level” – said Dziadzio.

The deputy head of the Ministry of Culture and National Heritage stated that the retail price of fuels is influenced by: the cost of raw materials, production costs, margins imposed by producers and traders of these fuels, the zloty exchange rate against the US dollar, in which the raw material – crude oil is purchased, as well as VAT and specific tax excise duty, which is not dependent on the price of a given motor fuel.

The excise duty rates are as follows: for motor gasolines PLN 1514 per 1000 liters, and for diesel fuels PLN 1145 per 1000 liters. Piotr Dziadzio pointed out that the specific excise duty rates for diesel oil and petrol have not been increased for years, 2012 and 2007, respectively.

At the same time, the government is not planning to lower the above-mentioned excise duty rates. “According to the information from the Ministry of Finance, there are no plans to lower the excise duty rates on motor fuels,” said the deputy climate minister.

Excise duty on fuel

As he wrote, the excise duty rates together with the fuel surcharge for motor gasoline and diesel oil for Poland are among the lowest in the European Union, they are at a level similar to the EU minimums, which for Poland are currently, in the case of petrol, EUR 359 per 1000 liters, and for diesel, 330 euros per 1000 liters.

“This level of taxation of diesel fuel means a difference of EUR 0.15 per 1000 liters from the Community minimum, as referred to in Council Directive 2003/96 / EC of 27 October 2003 on restructuring the Community framework for taxation of products. In the case of motor gasoline, the difference is EUR 14.68 per 1000 liters. In addition, taking into account the EUR / PLN exchange rate of 4.5826 PLN / EUR applicable in 2022, in order to maintain the required EU minimum level, the rate excise duty on diesel oil cannot be reduced, and in the case of petrol, any reduction in the excise duty rate due to the EU minimum could be imperceptible to consumers “- assessed Dziadzio.

According to the Ministry of Culture and National Heritage, Poland could take advantage of its membership in international organizations to exert joint pressure on oil-producing countries to increase oil supplies to the market, which will reduce the pressure on fuel prices.

Fuel prices – the climate ministry comments

The deputy minister assured that “the Ministry of Climate and Environment conducts regular monitoring of the fuel market, including changes in fuel prices”. “The current situation is unprecedented and is mainly due to the rapid recovery in demand for energy carriers following declines caused by measures to limit the spread of the COVID-19 virus and the limited response of crude oil and natural gas producers to these changes” – assessed Piotr Dziadzio.

As he emphasized, “The Ministry of Climate and Environment is open to dialogue with the fuel industry on the above subject.”

Jarosław Kaczyński on fuel prices

Deputy Prime Minister and President of PiS In October, Jarosław Kaczyński was interviewed by RMF FM whether the government should consider lowering excise tax rates on fuels.

– I do not think that this method is the best at the moment – said Kaczyński. As he said, “simply because in order to make changes in Poland, positive changes for the vast majority of society, and in fact for the whole society, because only those who live from cunning, can lose from it, the rest will benefit from it, and but this requires money, so I would not lower the state’s income. ” – However, I would suggest that various types of economic entities slightly limit their income expansion – he added.

The deputy prime minister assessed that the government could use various methods here. “I think something like this will happen, I will argue for it,” he added. As he stressed, “lowering the excise tax is not the only method to lower this price”.

– State income should not be limited, and excise duty is one of the important elements of the state income – he added.

Main photo source: Shutterstock

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