In order to contain inflation, the Government decided to postpone the increases in electricity and gas rates, scheduled for July, which were going to be made by an index tied to the evolution of prices. The increases were going to represent an additional impact of between 2% and 3% for homes, businesses and industries.
At the same time, the Minister of Economy, Luis Caputo, decided to move forward with an increase in fuel taxes, which will translate into a 1% increase in the price of gasoline and diesel as of July 1. As happened in June, the tax update is partial, given that the entire inflation transfer from the first quarter would have meant a 12% jump in the value of gasoline.
The official decision to postpone increases in gas and electricity rates seeks to moderate the impact on inflation, after the rise in gas prices in June and the beginning of the removal of subsidies to the middle and lower classes added points to the CPI.
The companies affected by the new postponement include Edenor, Edesur, TGS, TGN, Metrogas, Naturgy, Camuzzi, Ecogas, which had previously agreed on periodic adjustments with the Executive under a monthly indexation formula. However, this system will be re-evaluated with a perspective that incorporates projected future inflation. The latter is what was postponed again.
The Energy Secretariat, headed by Eduardo Rodríguez Chirillo, had already decided that the increase in winter gas costs would be borne by businesses, industries and high-income users, while progress would be made on the gradual removal of subsidies for low- and middle-income users. The same was done at the beginning of June with electricity rates.
The Government partially updates the fuel tax
The Ministry of Economy decided to move forward with an increase in fuel taxes, which will result in a 1% increase in the price of gasoline and diesel as of July 1. As happened in June, the tax update is partial, given that the entire inflation transfer from the first quarter would have meant a 12% jump in the value of gasoline.
To this increase in the liter of gasoline and diesel due to taxes, will be added what the oil companies decide to transfer to prices: it is estimated that at least they will rise to compensate for the 2% monthly devaluation and the increase in the costs of biofuels, therefore that values at the pump would increase around 5% or 6% from Monday, July 1.
Sources from the Ministry of Energy emphasized that the remaining update of fuel taxes exceeds $100 per liter for gasoline and $80 for diesel, and will be applied throughout the second semester, starting in August.
