Prime Minister Pedro Sanchez announced a third plan to fight inflation, bringing to 45 billion the amount of aid that Spain's leftist government has decided to allocate since the beginning of the year.
Spain's leftist government on Tuesday announced a series of measures to help the poorest people cope with the effects of inflation in the food sector, including the complete abolition of VAT on basic foodstuffs.
At this year's last Council of Ministers meeting, with Spain's next general election less than a year away, the government also decided to provide a €200 subsidy to 4.2 million families whose annual income does not exceed €27,000.
The 10-billion-euro package is the third of the year and brings the total amount of aid accepted by the Spanish government to 45 billion euros since the beginning of 2022. Socialist Prime Minister Pedro Sanchez also agreed with the European Union on a temporary waiver to limit the price of gas for power generation, allowing Spain to contain inflation to 6.7 percent yearly in November, the lowest among the 27 EU countries.
In addition, since some of the measures taken by the executive branch during the year expire on December 31, the government had to decide this week whether to keep them. For example, the head of government announced a six-month extension of the 5% reduced VAT rate on electricity and gas. Similarly, stopping basic services for the most vulnerable people who cannot pay their bills will remain banned in 2023.
Subsidies for workers who commute to work by train have been extended for a year, but the 20 percent discount on gasoline will be discontinued, except for transporters, farmers, shipping companies and fishermen.
At a press conference, Pedro Sanchez said that the aid adopted by the government has allowed Spain to record high rates of economic growth this year, which he estimated at more than 5 percent, higher than the previous forecast of 4.4 percent.