West News Wire: In its third large package this year, Spain has announced 10 billion euro ($10.65 billion) worth of measures to lessen the sting of inflation, increasing the total amount of help since early 2022 to 45 billion euro ($48 billion).
According to Prime Minister Pedro Sanchez, the package revealed on Tuesday includes a one-time bonus of 200 euros ($213) for around 4.2 million households with annual incomes up to 27,000 euros ($28,800) and the prolongation of tax breaks for energy bills into the first half of 2019.
It follows similar announcements in March and June that included direct aid, tax cuts, soft loans and rental controls.
The measures, coupled with an agreement negotiated with the European Union to place a limit on gas prices for electricity production, have had some success.
Inflation for the past 12 months slowed to 6.7 percent in November, the lowest rate in the 27-country EU bloc.
Slowing inflation has been aided by a sharp fall in electricity prices, which decreased by 22.4 percent from a year earlier in November.
But food prices have continued to hit Spaniards’ wallets, climbing 15 percent during October and November from a year earlier.
The government said it will cut the value added tax (VAT) on essential foods such as bread, cheese, milk, fruit and vegetables and cereals to 0 percent from 4 percent.
Pasta and cooking oils will have VAT slashed by half to 5 percent, Sanchez said.
Sanchez also announced 12-month extensions on subsidies for train travel for commuters and limits on rental increases.
However, a rebate on the price of petrol for consumers except for the haulage sector will be discontinued.
He said the aid provided so far had helped Spain register strong economic growth this year, which he put at more than 5 percent, above the government’s previous forecast of 4.4 percent.