Farese oil company criticises government’s unequal fuel tax relief plan

The managing director of the Faroese oil company Sp/F Thomsen has criticised the finance minister’s proposal to exempt petrol and diesel from value-added tax (VAT) while excluding heating oil, calling the distinction unfair, Faroese Broadcasting Corporation (KVF) reports.

In a statement, Tórhallur Thomsen argued that it would be “socially more just” to support households struggling with rising oil prices rather than prioritising vehicle owners. He questioned why heating oil—used by many Faroese homes—was excluded from the VAT exemption, which the government has proposed for petrol and diesel until 31 July due to high fuel prices linked to unrest in the Middle East.

The proposal’s explanatory notes suggest that relief for petrol and diesel is more effective, as households using heating oil often have payment plans that spread costs over months or years. The government also stated that the plan was developed in consultation with TAKS (the Faroese tax authority) and oil companies selling petrol and diesel, namely Effo and Magn. However, Sp/F Thomsen claimed it was not consulted.

Thomsen insisted that equally viable solutions could be found to extend VAT relief to heating oil, matching the support given to motor fuels.