Information regarding the reduction of VAT on fuel

According to the law, CompetitiveThe supervisory authority is authorised to impose administrative fines on companies that breach the relevant legal provisions. Furthermore, the minister is authorised to lay down regulations on temporary measures, following a report from the supervisory authority. Temporary measures may include the setting of a maximum price or a maximum mark-up, or other control over pricing or terms of trade. 

Í Report of the majority of the Economic and Commercial Committee The Bill further clarifies the obligation to pass on the VAT reduction to consumers. It reiterates the unequivocal duty for sellers to pass on the temporary reduction in full to the final sale price. In this way, sellers are „It is forbidden to increase one's own markup on fuel in order to take advantage of the benefits arising from a temporary reduction in VAT.“ 

However, the majority emphasises that the bill does not limit the seller's authority to make changes to the sale price. „in line with demonstrable changes in the purchase price or other external cost factors. Should the world market price for oil experience significant increases during the relevant period, sellers will not be required to sell their product at a loss. The Competition Authority must, by its very nature, take the above into account, as it should be straightforward for retailers to demonstrate the impact of external circumstances on their selling prices.“ 

In a genuinely competitive environment, there should be no need to monitor competitors' pricing. However, previous investigations by the Competition Authority into the fuel market clearly indicate that the fuel market is oligopolistic and competition is weak.  

See, for example, the report on this. No. 2/2015, on a market research on the fuel market, a report No. 2/2020, on changes to the fuel market following a market study, and consultation No. 7/2025, on the bill on a kilometre charge. In that opinion, the Competition Authority points out that there are indications that competition in the sale of motor fuel is limited. In those circumstances, „It is unwise for the government to assume that a reduction in fuel duties will be passed on in its entirety to consumers as a lower price at the pump, as it is in a difficult position to enforce this.“ 

Furthermore, reference may be made to the review on this matter. No. 3/2006 on the bill which has now become law, particularly paragraphs 6–9. 

The newly enacted legislation reflects the legislature's view that the competitive conditions in the fuel market require special monitoring to ensure that the legislation's objectives are achieved. 

Alongside the introduction of a kilometre charge at the turn of the year, public levies that had been collected on fuel were abolished. It was expected that this reduction would be passed on to consumers. Review The competition authority in this regard emphasised that from the customers' point of view, „It is an absolute minimum requirement that a reduction in fuel prices by the oil companies fully corresponds to a reduction in the public levies. Furthermore, it is essential that the reduction is realised over a longer period.“ Consumers and other customers of the oil companies were urged to be vigilant and monitor that the price drop would be passed on to them.  

Following the aforementioned changes, the FÍB, the ASÍ and individual trade unions have argued that in the run-up to the changes and in the first months of this year, the oil companies increased their mark-ups and/or raised the price of fuel.  

Concurrently, the Competition Authority has requested data from fuel retailers to, among other things, assess the development of fuel pricing in the market and the impact of competition on it. A first review of the received data indicates that the aforementioned conclusions of ASÍ, FÍB and others are well-founded. The data also indicate that there can be some variation between individual fuel companies in this respect. 

The Competition Authority will seek the views of the fuel companies on this and will subsequently publish its findings. This work will also inform the supervision that the Competition Authority has been entrusted with under the new legislation.