NEWS

Heating fuel tax set to escalate

In the midst of spiraling oil prices on international markets, the government has begun looking into various ways to combat the domestic consequences, including the booming illegal trade in heating oil, which is used as a diesel substitute. Development Minister Dimitris Sioufas said yesterday that changes in the taxation of heating oil, which will lead to a rise in its price, are likely to be unveiled by the end of July and will be made during the winter. «About 2,500 people are employed in the fight against the illegal trade in petrol,» he said. Heating oil is taxed at a lower rate than diesel, leading some to use the cheaper source as a substitute for diesel. As a result, the government has been losing 1.3-1.5 billion euros in tax revenues each year. Sioufas added that households will be able to recover the higher tax paid on heating oil in the winter. The minister’s announcement yesterday on higher-cost heating oil coincided with a new surge in international oil prices, which brushed record levels of above $60 a barrel. Greece, however, has so far been one of the lucky European countries, according to the European Road Information Center, which found that local petrol prices in May were the lowest in Europe. Unleaded gasoline in May was sold for 0.90 euros per liter in Greece in comparison with Belgium, which had the most expensive gasoline price at 1.24 euros per liter, it said.