Lisbon, April 7, 2026 (Lusa) - Portugal's government has submitted a bill to parliament seeking to temporarily lower the minimum fuel tax (ISP) until 30 June.

The bill was submitted to parliament on Monday to mitigate soaring fuel prices triggered by the ongoing conflict in the Middle East.

The government wishes to continue with the ISP discount by returning the additional VAT revenue, considering it “appropriate to temporarily and exceptionally reduce the minimum limit of the ISP rates, whilst ensuring compliance with the limits established by European legislation”, the government said.

Under the proposal, the minimum rates for the ISP on unleaded petrol will fall to €199.89 per 1,000 litres, and those on diesel will fall to €156.66.

Tax rates are established through ministerial orders, which determine the specific amounts to be applied from a set date, provided they fall within a range defined by law.

This provides for a temporary and exceptional amendment to the minimum unit rate limits for the tax on petroleum and energy products (ISP).

The temporary reduction applies when the rise in fuel prices exceeds €0.10 compared to the week of 2 to 6 March.

The extraordinary increase in oil prices resulting from the war in the Middle East had a "social and economic impact" on families and businesses, the government highlighted in the memo explaining the initiative.

PCT/MYAL // ADB.

Lusa