With fuel prices at record highs as a result of the energy crisis, there are several countries that have decided to act on the taxes applied to hydrocarbons. But, how much do we pay in Spain?
The price of fuel has skyrocketed and some of them even exceed the 2 euros per liter. The war between Russia and Ukraine has further fueled a long-standing trend and taxes only make the situation worse, since they constitute a significant percentage of the total price.
This has led the governments of some countries to decide to act on taxes to reduce fuel prices and in Spain we even faced a transport strike as a result of this and other problems.
But how much tax do we really pay each time we refuel? In the following lines we are going to answer this question in a clear and orderly way.
How many taxes are applied to fuels
The price of fuel is determined by many factors and among them are taxes.
Directly, gasoline and diesel see their price increase thanks to two taxes: Value Added Tax (VAT) and the Special Tax on Hydrocarbons (IEH)which in turn is subdivided into two: the General State Rate (TEG) and the Special State Rate (TEE).
On the one hand, the applicable VAT is 21%, although with nuances. And it is that, unlike what happens with the rest of the products in Spain, this percentage is applied to the base price plus the IEH. This, in practice, means that VAT is also paid on said tax.
Regarding the IEH, currently -and according to data from the Spanish Association of Petroleum Product Operators (AOP)– The breakdown of this tax is as follows:
Finally, it should be noted that until 2019 there was a tax corresponding to the regional section or the so-called sanitary penny. Each Autonomous Community could decide whether to apply it and to what extent, up to a maximum of 49 cents per litre. From that date, there was a unification for all of Spain currently included in the IEH.
Other costs that influence the price of gasoline and diesel
In addition to direct taxes, there are other factors that influence the final price of fuels. Naturally, the cost of the raw material is one of them, but not the only one. In addition, distribution costs and gross margins have an influence, which give the following breakdown as a final result:
Breakdown of the price of gasoline and diesel in Spain
- Raw material
- Distribution costs and gross margins
- Benefit
- Transport
- Cost of Service Stations
- Cost of strategic reserves
- Biofuel cost
- Cost of contribution to the FNEE
- Hydrocarbon tax
- overall state
- special state
- VAT
Although there is a tendency to think that this should be the case, the truth is that the price of fuel does not vary in the same proportion as the price of Brent crude.
In Spain, the price of gasoline and diesel does not depend directly on the barrel of oil, but on the prices of gasoline and diesel in the two reference wholesale markets: Northern Europe and the Mediterranean. Markets that also operate in dollars, which in turn also has an influence.
Apart from that, costs such as production, distribution and marketing do not usually vary and we cannot forget what we could call an indirect tax: the cost of maintaining the strategic reserves and the contribution that producers must make to the National Energy Efficiency Fund.
The first of these is part of a mechanism by which it is intended to guarantee the supply of goods and services considered essential.
For its part, the National Fund for Energy Efficiency is intended to finance mechanisms capable of increase energy efficiency in the different energy-consuming sectors. In this way, producers contribute to achieving the national energy saving objective established by the National System of Energy Efficiency Obligations.
How much tax payment for every 100 euros of fuel
As a final example, and according to data from the AOP, we can establish that for every 50 euros of gasoline, the money goes to the following:
- Wholesale gross margin: 1 euro
- Logistics and marketing cost: 9 euros
- Raw material cost: 17 euros
- Taxes: 23 euros
If we need a little more, we can say that, in the case of the gasoline 95taxes account for 54% of the total, while the wholesale cost constitutes 31% and distribution costs and margins amount to a total of 15%.
In the case of Diesel Ataxes add up to 49% of the total, with the wholesale cost taking 37% and distribution and benefits reaching 14% of the total price.