Cabinet expected to end petrol and diesel tax break; Fuel more expensive from July
The government will not extend its temporary reduction of excise duties on fuel, sources around the Cabinet told Het Parool. That means that refueling will become more expensive from July 1. A liter of petrol will become 13.8 cents more expensive, diesel 9.9 cents, and LPG 6 cents, according to the newspaper.
In March 2022, the government cut excise duty on fuel to help Netherlands residents cope with the high energy prices caused by Russia invading Ukraine. The government extended the measure for another six months on January 1 but won’t extend it again, the newspaper’s sources said.
That’s not really a surprise. The Cabinet is struggling to cover a massive gap in the budget caused by several setbacks. Due to the higher interest rates, the State is spending billions more on loans, the reception of asylum seekers is turning out much more expensive than budgeted, and the government has to compensate Groningen residents for the damages caused by decades of gas extraction.
The reduction in excise duty costs the government around 42 million euros per year. “All in all, the chance is small that we can continue to give that discount. Because it is already quite a puzzle to find money for other things that we consider more important,” a source from the Rutte IV coalition told Parool.
That might not be the only bad news for fuel prices in the Netherlands. Minister Rob Jetten for Energy and Climate recently proposed obliging filling stations to mix their petrol and diesel with more expensive biofuels. That would increase the petrol price by another 5 to 10 cents per liter.