this is the cheapest

He olive oil price continues to decline. Economist Gonzalo Bernardos had already foreseen this, assuring that the new harvest would lead to lower prices per liter in supermarkets. The government’s latest decision to reduce VAT to 0% has accelerated this. If a few days ago it was Mercadona the one who was in charge of the supermarket with the lowest price for liquid gold, the rest left and now Carrefour the one that sells olive oil at the most affordable price.

Olive oil It has recently become a product that families in Spain have been turning away from due to its ever-increasing price. With a litre often costing over ten euros, the government has approved a measure that VAT on olive oil to be reduced to 0%to later become a staple food and hence its normal VAT rate is 4%. The latest Consumer Price Index (CPI) data reflects a decline in demand for food. olive oil price fallssomething that has now intensified with the new fall.

The decision that olive oil will have a VAT rate of 0% was approved in the Council of Ministers on June 25, where it was established that VAT on products such as milk, bread, eggs, fruits, vegetables or legumes will remain at 0%. , now we add olive oil. This measure, yes, will remain until September 30after which the tax rate will increase to 2% and remain in effect until the last day of the year. This means a reduction in the price of the shopping basket and, in particular, olive oil, “healthy and the price of which has recently increased“, the Spanish government itself reports.

Mercadona lowered the price, others did the same

In the month of June, olive oil price fell 2.4% compared to May, according to data published by INE. Despite this, compared to last year, the cost of olive oil is still very high. 53.7% more expensive than in June 2023. To alleviate this situation, the government approved a 0% VAT rate, which has been reflected in prices in recent weeks and, as a result, in the pockets of consumers, who will now see the price of olive oil appear even lower. after Mercadona initially reduced the prices of its products, a trend that was followed by the rest of the supermarkets in Spain.

Just a few days ago, Mercadona announced that it had invested $1 million to “offer a menu basket of excellent quality, at the best price on the market“, reducing their price from 9.19 to 8.95 euros, making them the chain with the best current price. However, this did not last long, as the rest of the supermarkets did the same, setting the same price, and some even reduced it even more, as in the case of Carrefourwhich now has the cheapest extra virgin olive oil after reducing its price. up to 8.93 euros per liter.

Price in other supermarkets in Spain

The effects of the VAT reduction were initially noticed in supermarket chains, and now the price continues to fall in Alcampo, El Corte Inglés or Eroski, in addition to the already mentioned Mercadona and Carrefour. In all of them, a liter of extra virgin olive oil with a white label was about ten eurosThe figure has started to decline, partly due to rainfall in recent months and a milder climate, the economist said. Gonzalo Bernardos on the programme “Better Late” on La Sexta. However, the professor of economics at the University of Barcelona was cautious, calling for “restraint” from Spanish supermarkets given the likelihood that they will raise prices to increase their profits.

It should be remembered that the measure previously applied to olive oil was Reduction of VAT from 10% to 5%so now, after the measures approved by the Government came into force, the price has been reduced even further. If we take extra virgin olive oil as a basis, this is what the prices are currently in some of the main Spanish supermarkets after the discount has been applied.

These are specific cases applicable to the white brands of various supermarket chains in Spain, which mean saving about 70 centsbut of course they weren’t the only ones to see their prices drop. At El Corte Inglés, for example, a litre of Carbonell 0.4° soft olive oil was €12.99, and with the discount the price dropped to €12.37. Now, yes, that figure has been reduced to €10.69, which means saving more than two euros compared to the original price. At the same time, the measure was also seen in large quantities. For example, a five-liter bottle of Aromas del Sur cost 44.89 euros and fell to 42.75 euros, a decrease of 2.14 euros.

It seems like pockets consumers will finally be able to rest in the coming months regarding the purchase of olive oil. But even in this case, we will have to see how production develops, because from September 30 the measures will change and prices, including VAT, will increase, even if only by 2%.