The European Union called on the Government to reduce the VAT rate on fuel

The European Union has called on Prime Minister Milojko Spajić and the Government to reduce the value added tax (VAT) rate on fuel in order to prevent the expected enormous price increase and enable the smooth functioning of the economy and citizens.

European Union official Mirko Stanić said that since the beginning of the oil crisis, the European Union has been actively involved in proposing measures to reduce prices for citizens and the economy, and among these proposals, the key ones are related to reducing excise duties and VAT on fuel. Both laws were proposed by the Union's deputies and are already in the procedure.

"Today, the incompetent Spajić government is taxing the citizens of Montenegro extra through increased prices, almost seven cents more than before the increase, due to the increased VAT base," Stanić said in a statement.

He said that the Macedonian government will today reduce VAT on diesel fuel from 18 percent to ten percent, while it has already previously reduced excise duties on both diesel and gasoline, which is why prices in that country are by far the lowest in the region. A number of EU countries have also made similar reductions in VAT on fuel, with significant price reductions at the pumps.

"With the worsening situation in the Red Sea and another oil route that is part of war operations - the expected price of a barrel of fuel will reach $110, which could cause the price of fuel in Montenegro to exceed the psychological limit of two euros per liter, especially for diesel fuel, which is used by almost the entire economy and 78 percent of citizens," said Stanić.

He stated that the collection of both excise duty and VAT, especially on fuel, according to data from the Ministry of Finance, is at a higher level than last year and at a higher level than expected in the first eight months, which clearly shows that there is no danger to public finances if the Alliance's proposal is adopted.

"Therefore, we call on Prime Minister Spajić and the Government to urgently consider our initiative and reduce the VAT rate on fuel in order to prevent the expected enormous growth and enable the smooth functioning of the economy and citizens," the statement concludes.