Heating oil suppliers call for 'generous' reduction on special consumption tax

The Federation of Fuel Service Station Dealers (OBE) on Monday called for a "generous" reduction of the special consumption tax on heating oil as the government is poised to put the issue before its international creditors in September.

In a letter addressed to recently appointed Finance Minister Gikas Hardouvelis, OBE argued that consumers will continue to abstain from purchasing heating fuel this coming winter unless its cost goes down significantly.

Finance Ministry officials have said that the measure of leveling the tax on heating oil with that on diesel, meant to curb illegal fuel sales, has failed, leading to revenue losses of nearly 400 million euros for the state coffers.

"Recent publications from leaked sources suggesting a reduction on the price of heating oil by 8 to 10 cents on the liter, are not just unacceptable, but are angering consumers and fuel suppliers as games are played around an issue that has plagued them," OBE said in its letter.

The federation is calling for dialogue on the proposed reduction "based on what households can tolerate and not on the preconditions of the troika."

The government is planning to submit a request to its creditors in September for the reduction of the special consumption tax on heating oil by 15 to 20 percent. If they consent, the final retail price of heating oil will drop by about 8 cents per liter this fall to reach 1.32 euros/lt, compared with 1.40 euros/lt in October 2013, provided oil prices remain the same.