EC 'understands' petrol VAT cuts
Tax reductions are not a feasible solution for the problem of high retail petrol prices, says Tax Commissioner of the European Commission László Kovács. Tax reductions do not inspire to reduce consumption and therefore do not motivate oil producing countries to lower prices, he claims. However, the Commission will not impede Hungary in lowering its VAT rate on petrol and gas oil, says Mr. Kovács. There was a debate about this issue inside the Commission yesterday and Commissioners agreed not to examine if tax reductions in various member states are compatible with EU legislation or not. The Commission shows understanding for these kind of provisional measures, Commissioner Kovács says.
