Fuel tax discounts updated as diesel prices continue to climb
The government has updated the discount on the tax on petroleum products (Imposto sobre os Produtos Petrolíferos or ISP), setting the rate at 28.5 cents per liter for diesel and 45.6 cents for petrol starting Monday. Despite the adjustment, diesel costs have risen significantly due to international tensions, with a full tank now costing roughly €23 more than before the Middle East conflict. Drivers should expect simple diesel (gasóleo simples) to exceed €2 per liter at many stations.
The ISP (Imposto sobre Produtos Petrolíferos e Energéticos) is Portugal's excise tax on petroleum and energy products, charged as a fixed amount per liter on petrol, diesel, and other fuels. It is one of the main components of fuel prices at the pump, alongside VAT and the carbon tax (Taxa de Carbono).
The government can adjust ISP rates — temporarily or permanently — to influence fuel prices. Rate cuts are a common policy tool to ease cost-of-living pressures on drivers and transport businesses, though they also reduce government revenue.
For consumers, the ISP is significant because even small changes in the per-liter rate translate into noticeable differences at the pump, particularly for diesel users and commercial transport operators.
