Gasoline increases in July due to a tax increase and future inflation will also boost electricity and gas rates

Gasoline increases in July due to a tax increase and future inflation will also boost electricity and gas rates
Gasoline increases in July due to a tax increase and future inflation will also boost electricity and gas rates

Starting Monday, July 1, there will be fuel increases again (gasoline and diesel) throughout the country, energy rates (gas nationwide and electricity in the City and Greater Buenos Aires) and the water and the sewers in the Metropolitan Area of ​​Buenos Aires -AMBA-.

Next week the multiple price increases will start from the first hours with gasoline and diesel, which will climb more than 2%, due to the transfer of the monthly devaluation of the peso against the dollar.

What will the increase in gasoline and diesel be like?

But also, The Government will increase taxes on fuel again (Liquid Fuels Tax -ICL- and Carbon Dioxide Tax -IDC-), as stated in Decree 466/2024.

The increase will be $114.15 per liter of gasoline and $91.89 per liter of diesel when the second half of 2024 begins, unless the Government decides to defer or divide that update into installments again, as it has been doing since the beginning of this year. In that case, it would impact the need for oil companies to increase super gasoline by up to 12.5% ​​(today at $905 in the City of Buenos Aires) and diesel oil by 10% (currently at $941).

As far as he could know Clarionthe Ministry of Economy and the Federal Administration of Public Revenues (AFIP) are “working” precisely in a scheme so that the impact is not so strong, it is divided into several months and that it is not fully transferred to inflationwhile sustaining tax collection.

Between January and May, the collection of fuel taxes totaled $525,858 million, 192.2% more than in the first five months of 2023. With these adjustments, the Government seeks to add income for the equivalent of about 0.5 percentage points of the Gross Domestic Product (GDP) or almost 3,000 million dollars, 10% of the total adjustment that President Javier Milei is pursuing for this year.

In addition to what will be the jump in the prices of gasoline and diesel, the oil companies also look at their own accounts and observe that there is a delay or gap between the local fuel sales values ​​and the international “parity” that is around 11% to 13%.

They will seek to progressively rebuild these margins until the end of the year, as inflation slows and demand is reactivated. In April, according to data from the Argentine Confederation of Workers and Employees of Hydrocarbons, Energy, Fuels, Derivatives and Related Products (CATHEDA), fuel sales in general fell 8% year-on-year, while at service stations They collapsed 13%.

Light and gas

On the other hand, Since July, the increases in the margins of the companies that provide regulated public services for the transportation and distribution of electrical energy and natural gas through networks will resume.. These include Edenor, Edesur, Transener, Metrogas, Naturgy, Camuzzi, TGS and TGN, among others.

Transportation and distribution are two of the four components of the bills (the others are generation or production and taxes), and they weigh between 40% and 50% in the final bills paid by households.

In May and June, the Government suspended the application of the monthly update formula that was based on the past evolution of inflation, salaries and even the cost of construction, and starting next month it will change the formula to reflect inflation. expected future.

The Minister of Economy, Luis Caputo, must define which indicator he uses to estimate the evolution of prices (if, for example, you use the Market Expectations Survey -REM- from the Central Bank -BCRA- or decide on a monthly “inflation target”).

If Caputo pointed out that the expected inflation for July is 4%, user bills would rise by approximately 2% in the end..

Water and sewer

In water and sewage, the service provided Argentine Water and Sanitation (AySA), However, the formula that remains in force is the one that indexes rates according to past variables, due to its low impact on inflation. The salary data for April, which the National Institute of Statistics and Censuses (Indec) will publish this Wednesday at 4 p.m., is the last thing left to know how much it will be. next month’s rate increasethat it would be around 2%.

Based on recent increases, AySA reached financial balance in its accounts in May for the first time in recent yearssomething I hoped to achieve only by October.

That is to say, does not need more subsidies from the national State -which cover household expenses- for its operation, after a strong adjustment implemented by the new authorities in personnel and works. Furthermore, this result makes it possible to avoid strong rate increases in the future.

With a balanced balance, The Government aims to open AySA to concessions to private companies that will be enabled after the full sanction of the Bases Law, possibly this Thursday in the Chamber of Deputies.

Finally, a course on bus fares is also being evaluated, which have remained frozen since February. The maximum possible increase is 71.9%, the inflation accumulated in the first five months of 2024.

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