The Polish government is preparing a tax intervention to mitigate rising fuel costs, with Prime Minister Donald Tusk announcing the “CPN – Lower Fuel Prices” program on Thursday.
Government Announces Fuel Price Intervention
The Polish government is implementing a tax intervention on the fuel market. Prime Minister Donald Tusk announced the introduction of the CPN – Lower Fuel Prices program on Thursday, designed to directly impact gasoline and diesel prices at stations.
The planned tax changes are part of protective measures against sharp increases in energy commodity prices. The government analyzed various scenarios, but a temporary reduction in fuel tax rates, including VAT and excise duty, has emerged as the most viable solution.
Mitigating Middle East Conflict Impact
Tusk stated that the government will launch a package of decisions today to alleviate price increases related to the conflict in the Middle East.
Details of the Tax Reductions
The plan includes reducing VAT on fuel to 8 percent and lowering excise duty on fuels. The excise duty reduction will be equal to the minimum required by EU regulations – 29 groszy for gasoline and 28 groszy for diesel.
The Prime Minister announced a maximum retail price will be introduced for fuels.
Ensuring Real Benefits for Drivers
Finance and Economy Minister Andrzej Domański emphasized the importance of ensuring a real effect for drivers. He stated the government wants to avoid a situation where tax cuts are absorbed by market participants, such as refineries, wholesalers, or gas station operators.
The mechanism must be designed to directly translate fiscal relief into lower prices at the pump, requiring monitoring of margins and potential regulatory actions.
Potential Tax on Fuel Company Excess Profits
The possibility of taxing excess profits of fuel companies is also being considered, particularly when high oil prices lead to above-average refinery and sales margins.
Minister Domański clarified that such a tax is not currently being implemented but remains a real option if the market does not respond to the VAT reduction as expected. He noted that the issue of high margins is not limited to Poland but affects all of Europe.
Orlen’s Role and Global Oil Prices
The actions of major market players also influence fuel prices. Orlen has already decided to limit margins, partially mitigating price increases at stations. Due to the company’s dominant position, its actions set the price level for other operators.
The direct cause of the government’s actions is the situation in the global oil market. Brent crude oil prices approached $100 per barrel on Thursday morning, significantly increasing the cost of raw materials for refineries.
Geopolitical Factors and Supply Disruptions
Geopolitical events in the Middle East triggered the price increases. The commencement of military operations against Iran led to the blockage of the Strait of Hormuz by Tehran. This strategic waterway accounts for approximately 20 percent of global oil flows, making it a key point for the world energy market.
