Caminha, Portugal, April 7, 2026 (Lusa) – Portugal's energy minister explained on Tuesday that the temporary amendment to the Petroleum Products Tax (ISP) scheme allows the tax to be reduced “to the lowest possible level” and “discounts to continue”.
“The aim is to create the conditions so that we can continue to offer ISP discounts,” said Maria da Graça Carvalho during a visit to the Moledo sea wall stabilisation works in Caminha, Viana do Castelo.
She explained that the government was “reaching the level permitted by Portuguese law” and the draft law the cabinet approved via video conference on Monday means it can now “go lower in line with European rules”.
When asked what the minimum level the ISP could reach would be, she said it was a matter of “a figure that the Ministry of Finance will now calculate”.
“Every Friday, we have to check what the discount is. There is a decree from the Minister of Finance and me, according to which whenever [fuel] prices rise above 10 cents, for petrol and diesel, a discount is applied. And we were reaching the limit permitted by Portuguese law, but we can still go lower under European rules,” she summarised.
On Monday, the government approved a temporary amendment to the ISP regime to extend tax relief on fuel, the prices of which have been rising due to the conflict in the Middle East.
According to the government’s statement, the proposal temporarily amends the ISP's legal framework by “lowering the minimum tax thresholds”.
“This amendment allows the government to continue reducing the ISP periodically and temporarily, by returning the additional VAT revenue resulting from recent fuel price rises following the conflict in the Middle East,” the statement noted.
The draft law the government submitted to parliament to temporarily lower the minimum tax thresholds on petroleum and energy products (ISP) provides for the reduction to remain in force until 30 June.
The legislative initiative was tabled in parliament on Monday, the very day the cabinet approved it, and includes a ‘request for priority and urgency’ for parliament to consider the amendment, aimed at responding to the rise in fuel prices caused by the war in the Middle East.
Fuel prices rose again this week, following consecutive increases since early March, amid severe geopolitical tension in the Middle East, with oil prices under pressure from the closure of the Strait of Hormuz and volatility in international markets.
ACG/MYAL // ADB.
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