13th March 2022, Skopje – Latest set of anti-crisis measures amounting to EUR 400 million is part of around EUR 615 million worth set of measures the Government has adopted and implemented so far, geared towards facilitating the price pressures stemming from the energy crisis and the food price increase on the global stock markets. In his article, Minister of Finance, Fatmir Besimi, underlines that since last year, the Government has started monitoring price pressures and adopting measures aimed at maintaining the prices at a level lower than the market one.
As he wrote in his article, fiscal effect from reduced VAT on electricity from July last year is incorporated in the amount of EUR 615 million, as are the electricity and heating subsidies, all to the end of maintaining the prices at a level lower than the market one.
“This amount is close to the amount the Croatian Government has projected to manage the price pressures, around EUR 635 million. For comparison purposes, Greece has projected EUR 500 million, Slovenia and Albania have projected around EUR 200 million each, etc.”, Besimi pointed out.
He further on elaborates on the measures announced or being implemented in the countries in the region and the EU countries. They include transfers to vulnerable categories, reduction of taxes on energy products and regulation of retail prices.
“Slovenian measures are aimed at targeted financial transfers, also envisaging support to pensioners, social assistance beneficiaries, disability and child allowance beneficiaries, multi-child families and foster parents. Serbia has adopted measures for improvement of energy efficiency by financially supporting households, also introducing measures to freeze prices on flour, sugar, sunflower oil, pork meat and milk and banning export of some commodities. Montenegro has adopted measures for reduction of excise duties on fuel and one-off assistance for pensioners receiving below-the-average pension. Greece, Bulgaria and Albania have also introduced models for subsidizing the electricity prices for households and businesses”, Besimi pointed out.
When designing the latest set of measures, other countries’ experience has been analyzed. This set includes tax measures, financial support to vulnerable categories, administrative restrictions to prices and energy saving measures. Implementing the respective measures will cushion increase of prices of food and fuel, support companies, as well as contribute to greater energy efficiency.
Tax relief envisaged in the new set of measures, such as abolishment of VAT on food, 5% preferential rate on electricity for households by the end of the year and 10% VAT rate on fuel, as well as reduction of excise duty on fuel, have been already adopted and effective just few days after their announcement.
Besimi emphasized that even with the scenario of protracted crisis on the global energy and commodities market, fiscal space allows for additional intervention to protect the standard of the citizens and companies’ liquidity.
“What is especially important for all of us in times of crisis and high prices of commodities and energy products is that we can all contribute greatly by taking own steps by saving and proportionally consuming energy products during this period, for the difference in prices to affect less on our income, regardless of whether as an individual, a family or an enterprise/business. No one says it is going to be easy, but I assure you as a Minister of Finance, and on behalf of my colleagues in the Government, we will fight for the citizens to feel the pressure from the Russian-Ukraine conflict as less as possible”, Besimi wrote, adding that the Government has proven it with the anti-crisis measures during the pandemic, which have significantly cushioned the effects on the economy.
“Medium- and long-term macroeconomic and fiscal frame is well established, envisaging fiscal consolidation and accelerated growth, aimed at development of our economy”, Minister of Finance, Fatmir Besimi, wrote.