Portugal: Prices of 14 essential items rise over 6% since end of zero VAT – Deco

The prices of 14 of the 41 products in Portugal that were part of the essential food basket have already risen by more than 6% since the Zero VAT measure ended on Thursday, according to a report released on Tuesday by consumer watchdog Deco Proteste.

According to the consumer protection organisation’s analysis, from the last day of Zero VAT, January 4, until Monday, the prices that rose the most were those of liquid yoghurt, cooking oil and tins of tuna in olive oil.

“Between the 4th and 8th of January, the average increase of the 41 products was 5.29 %, totalling €7.51 and raising the average cost of the basket from €141.97 to €149.48, respectively,” it explains.

With the end of the VAT exemption, products were again taxed at 6% VAT, except for cooking oil, which was taxed at 13%, compared to the previous rate of 23%.

In what is the first assessment of the end of Zero VAT on the essential basket, Deco Proteste found that “retailers increased prices below 6% on more than 21 products, which means that there may have been an attempt to mitigate the immediate impact of the reintroduction of VAT through promotions on products covered by the exemption”.

“This practice may have helped to minimise the initial impact felt by consumers,” says the association’s communications director, Rita Rodrigues, quoted in a statement.

However, she points out that “it is possible that, especially on the first day of the reintroduction of VAT, there was some delay in updating the prices displayed”.

Aimed at offsetting the effects of rising inflation, the Zero VAT measure was in force between 18 April 2023 and 4 January 2024 and covered 41 essential products for consumers, exempting them from VAT.



Leave a Reply

Back to top button