Opposition leader urges permanent fuel tax cut

Sigríður Á. Andersen, parliamentary group leader of Iceland’s Centre Party, has called on the government to make the reduction in value-added tax on fuel permanent, mbl.is reports.

VAT on petrol and diesel will rise from 11% to 24% at midnight. The tax was temporarily reduced at the beginning of May as part of the government’s measures to combat inflation.

“Now that Iceland is not heading towards EU membership, we are perfectly free to keep the tax at 11%,” Sigríður wrote on social media. “I urge the government to make the VAT reduction on fuel permanent.”

All opposition parties said in mid-August that they were prepared to take action and call Parliament together to extend the authorisation for the VAT reduction.

However, the Social Democratic Alliance and the People’s Party did not support convening Parliament. A decision on extending the reduction will therefore have to wait until at least mid-September, as parliamentary involvement is required.