May 19, 2022 6:06 pm

More than half of what is paid in Spain for gasoline and diesel are taxes




We start the year with record fuel prices. Gasoline is sold at many service stations above 1.7 euros per liter and diesel exceeds 1.5 euros. That is, filling the tank of a car with a gasoline engine can cost more than 80 euros.

are also the prices of the entire European Union that have grown the most in the last year, although in reality we consumers only pay half of what it costs us for the product, since almost 50% are taxes, according to the
Spanish Association of Petroleum Products AOP

In Spain, liquid fuels derived from petroleum are subject to two taxes: VAT and the Special Tax on Hydrocarbons (IEH).

Some taxes that together add up to more than half of the price we pay at gas stations when refueling. In the retail price of a liter of gasoline, 55% are taxes, 15% distribution costs and margins, and 30% raw material costs.

In diesel it is very similar, although the tax burden is somewhat lower, 50%. However, distribution costs and margins are 14% and raw material rises to 36%.

Therefore, as explained by AOP, the retail price (RRP) is made up of two main elements: taxes and the price before taxes (PAI). Depending on the type of fuel, diesel A or gasoline, the Special Tax on Hydrocarbons (IEH) varies, however, we can summarize that taxes constitute between 46 and 50% of the final price. The remaining part corresponds to the price before taxes, which includes the international price of wholesale fuel and the gross distribution margin, that is, the costs of logistics and storage, the cost of transporting the fuel to the service station, the costs of service stations, the cost of incorporating biofuels, the cost of strategic reserves, the cost of contributing to the National Fund for Energy Efficiency and the profit margin of wholesalers and retailers, etc.


The price is also affected by other associated costs, such as the maintenance of strategic reserves and the contribution to the National Energy Efficiency Fund.

One of the most frequent doubts among consumers is why the price of fuel does not vary in the same proportion as the price of Brent crude. As explained by AOP, the price of gasoline or diesel/diesel in Spain is not directly related to the price of a barrel of oil.

The final price depends on the prices of gasoline and diesel in the reference wholesale markets (Mediterranean and Northern Europe in the Spanish case). Since these markets are traded in dollars, the euro/dollar exchange rate is also a significant factor. There are expenses that practically do not vary, including production, distribution and marketing costs, which include wholesaler and retailer margins.

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