Román Rodríguez, vice president and Minister of Finance of the Government of the Canary Islands, has insisted in several appearances that reducing the special fuel tax would not imply a drop in the price for the consumer, so he maintains that the only solution is market intervention.
He has also pointed out that he will have to make a budget adjustment of 400 million euros due to inflation, so reducing prices could directly affect the income that the Autonomous Community then allocates to other sectors such as health, education or social services, according to the news portal of the Government of the Canary Islands.
“We must focus on the root of the problem, instead of adopting irresponsible decisions that would only undermine the capacity of the public administration to attend to fundamental public services and provide coverage to those who are now precisely having the worst time due to inflation,” the vice president pointed out.
Rodríguez gave the example that on the Peninsula the VAT on electricity was reduced from 21% to 10% and it did not manage to stop the rise in prices, but it did increase the profits of the electricity companies.
In addition, he added that in the Canary Islands there is a 0 type of IGIC with respect to the tax on fuel, as well as with electricity in contracts of less than 10Kw, so taxation is practically non-existent in the Canary Islands.
"The problem is determined by the price of raw materials and speculative tactics, not by the amount of the tax", says the vice president. "We have to go to the origin of the problem and in that direction it is the Government of Spain and the European Union who have the capacity to adopt measures that cushion the escalation of prices."
However, Román Rodríguez added that this fiscal difference between the Peninsula and the Canary Islands will continue to be maintained in the event that the Government of Spain lowers its Special Hydrocarbons Tax.
The next few weeks will be decisive in combating the escalation of prices, a topic that will be discussed at the European Council on the 24th and 25th, and at the Council of Ministers on the 29th, where income agreements are expected that will limit business profits.
In any case, the Minister of Finance of the Government of the Canary Islands assured that the Government of the Canary Islands will provide the necessary aid to the sectors most affected by inflation.
