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Eurofound's EU PolicyWatch collates information on the responses of government and social partners to the COVID-19 crisis, the war in Ukraine, rising inflation, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.

Factsheet for measure GR-2022-12/2264 Updated – measures in Greece

Subsidy for fuels for low- to medium-income individuals and taxi services

Epidotisi katnalosis kafsimon fisikon prosopon kai miosi timis petrelaiou kinisis (Επιδότηση κατανάλωσης καυσίμων φυσικών προσώπων και μείωση τιμής πετρελαίου κίνησης)

Country Greece , applies nationwide
Time period Temporary, 17 March 2022 – 30 September 2022
Context COVID-19, War in Ukraine, Digital Transformation
Type Legislations or other statutory regulations
Category Responses to inflation
– Support for fuel expenses
Author Penny Georgiadou (INE GSEE)
Measure added 13 May 2022 (updated 26 September 2022)

Background information

The government, in March 2022, introduced a series of support measures to address the impact of price rises due to the continuing health crisis and the war in Ukraine.

In this context, articles 81, 82 and 83 of Law 4916 (articles 81,82,83) on 28 March 2022 introduced the subsidising of fuel consumption for individuals, reducing diesel fuel prices and also supporting measures for taxi services.

These measures aimed at strengthening the middle class and the lower income households.

Content of measure

The economic measures to subsidize fuel consumption taken by the government, in accordance with law 4916 (articles 81, 82 and 83) as were specified, include the following:

  • Direct fuel subsidy to citizens, which covers a part of the price increases for three months. Beneficiaries are individuals, tax residents of Greece, with a declared family income of up to €30,000. It is estimated that 3 million persons having at least one car and low income, can benefit from the measure. The amounts of the total subsidy range from €30 to €50 for the 3-month period (April, May, June), depending on the vehicle and the place of the main residence of the beneficiary. The subsidy is tax-free, non-assignable and non-confiscated. For those beneficiaries that choose to use a digital debit card, the amount of the aid may be increased up by €5. According to the Minister of Finance, the total cost of this support measure is estimated at €130 million.
  • Subsidy at the source, from the state budget, on the selling price of the diesel for April, so that the consumer can benefit from a 15 cent per liter. This price reduction is important for containing prices low in the supply chain. According to the Minister of Finance, the total cost of this support measure is estimated at €23 million.
  • Aid of €200 to taxi services during the month of April, in order to cover part of the increased fuel costs.

Updates

The following updates to this measure have been made after it came into effect.

02 July 2022

The government with the law No. 4950 of 2022 (article 67), renewed the fuel subsidy for the months July, August and September 2022. Beneficiaries of the measure are those who have a declared income of up to €30,000 increased by €3,000 per child and with a limit up of €45,000.

The subsidy can be used with a digital debit card covering €80 for cars and €60 for motorcycles in mainland Greece. On the islands, the subsidy covers €100 for cars and €70 for motorcycles.

If a bank account is used instead of the digital card the subsidy is reduced by €15.

The potential beneficiaries of the measure are estimated at 3.1 million persons out of the 3.5 million vehicle owners.

The total cost of the fuel subsidy has been estimated at €200 million. For the diesel users, the subsidy remains at 15 cents per liter at the source of the consumption including VAT. The total cost of this specific measure is estimated at €115 million.

Use of measure

According to the Minister of Finance, 3 million persons owning at least one car and declaring a low family income will receive support. Especially for the taxi services, the Ministry of Finance until April 20, paid a total amount of €3,935,800 to 19,679 beneficiaries of the Special Purpose Compensation in taxi services.

Target groups

Workers Businesses Citizens
Self-employed
Other groups of workers
Sector specific set of companies
One person or microenterprises
People on low incomes

Actors and funding

Actors Funding
National government
National funds

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role No involvement No involvement
Form Not applicable Not applicable

Social partners' role in the implementation, monitoring and assessment phase:

  • No involvement
  • Main level of involvement: N/A

Involvement

There was no involvement of social partners.

Views and reactions

Before the announcement of the measure the taxi drivers associations have generally asked for the coverage of the cost from the increase of the fuel prices. After the measure there was no reaction by the taxi drivers.

Sources

Citation

Eurofound (2022), Subsidy for fuels for low- to medium-income individuals and taxi services, measure GR-2022-12/2264 (measures in Greece), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/GR-2022-12_2264.html

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