No cheaper fuel in sight as coalition conflict continues

Lower VAT on motor fuel would violate EU rules.

Richard Sulík and Igor MatovičRichard Sulík and Igor Matovič (Source: Sme - Marko Erd)

The prices of fuel have increased by a third since the beginning of the year, but come June, the government has still not agreed on a way to help people in Slovakia to cope.

The lowering of prices by changing the fuel tax could have been paid from the special tax on Russian crude oil processed by the Slovnaft refinery. The parliament was expected to decide by Wednesday, May 25, but that did not happen.

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The special tax was proposed by Finance Minister Igor Matovič (OĽaNO) as a way to cover the costs of his package, intended to help people cope with rising prices.

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The leader of the coalition, Richard Sulík of SaS, gave the condition that the new tax could be introduced by slashing other taxes – VAT on petrol and diesel. The tax cut would translate into an actual lower price for fuel, he claimed. But the rules set by the European Commission do not allow such a step.

Sulík and Matovič have been in open conflict over the taxes, among other things. On May 25 they appeared to find common ground, and being able to use the time obtained by postponing the vote on the law in order to negotiate an exemption from the European Commission.

“We’ve agreed that in the meantime, before the law is proposed at the June session, the Ministry will reach out to the European Commission with a request to negotiate an exemption,” said Marián Viskupič (SaS).

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“Minister Matovič offered that he would contact the European Commission in this matter. Minister Sulík volunteered to lead and coordinate all negotiations with the Commission,” said SaS MP Anna Zemanová. The MPs from the coalition's Za Ľudí and Sme Rodina confirmed her words.

The conflict continues

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