In the last few hours, the Government decided to reverse the planned increase in electricity and gas rates and will not apply adjustments to the fuel tax.
The fuel tax was going to be updated by 115%, which would have impacted an increase of 18% in the City of Buenos Aires. The measure seeks to avoid additional pressures on the cost of living, with the intention of “not reheating the pressure on the cost of living in that month and taking the foot off the accelerator by applying more costs to households that have suffered a strong loss of purchasing power.”Seasonality is also sought to be taken into account, i.e. greater consumption during the winter.
The decision has been made, in principle, only for July rates, with the aim of supporting the recovery of the population’s purchasing power. The measure will be applied to household consumption next month and, depending on the billing date, most users will pay it in August.
Earlier this month, the Government modified the maximum subsidized consumption caps and the bonuses on wholesale prices of electricity and natural gas for N2 (low-income) and N3 (middle-income) users in accordance with the Transition Period established by Decree No. 465/24. This measure marks the beginning of a process to move from a generalized subsidy regime to a targeted one, in which the user can know the cost of the kW of electricity and m3 of natural gas, which is identical for all.
In addition, users will be able to determine what assistance the State provides according to their ability to pay, reaching up to a consumption limit through the recognition of a lower payment (bonus).
Taking an average consumption bill of 250 kW, the increases in the different categories will be:
– N1 (high income): from $24,710 to $30,355 pesos (23% increase). In July, if they maintain the same consumption, they will pay this same figure, that is, $30,355. This category covers 1.5 million households.
– N2 (low income): from $6,295 to $12,545 (99% increase). It includes 1.9 million users.
– N3 (average income): from $6,585 to $16,850 (156% increase). It encompasses 1 million clients.
As for gas rates, July consumption will not increase either, which means that the user will pay exactly the same as in June, as long as their consumption is the same. For the current month, increases in the gas tariff table of 9.2% for segment N1, 33% for N2 and 10% for N3 had been established.
