After the new changes in tariff hours made by the government in June, it should be noted that also they announced a reduction in VAT from 21% (general rate) to 10% (reduced rate) on customers’ electricity bills. This will not be considered as a permanent drop and is not for all types of consumers.
Who will benefit from this drop in tax on electricity bills?
As we mentioned, this drop will not be aplicable for all types of consumers. It will only be for those who have contracted a power equal to or less than 10 kW, this covers most residential properties but not medium & large companies.
In addition, we also mentioned that it would not count permanently, therefore it will only apply until the end of this year 2021, with the sole condition that the average monthly price of the wholesale electricity market is over € 45 / MWh, which it is currently between € 90-100 / MWh.
For households considered severely vulnerable, (the ones that currently receive a 40% discount due to the social bonus), the reduction will not affect them in any way.
They will be able to continue with the reduced rate VAT of 10% until the end of 2021 regardless of the type of power they have contracted and the market price.
In addition to this measure already approved by the government, they also announced the suspension of Tax on the Value of Energy Production of 7%, which will be maintained during the months of July, August and September and these affect customersbut are actually assumed by the companies.
According to Facua (Consumer Association) they calculate that each clientwill save an average of € 6.77 per month with these changes already announced, which will be on top of the saving you have by being an Evergreen Eléctrica client.
So what do you think about the new changes? For any questions or queries, do not hesitate to contact us through the Evergreen Eléctrica contact page