Portugal extends fuel tax (ISP) discount until end of 2026

A new law has been published in the Diário da República extending the discount on the Tax on Petroleum and Energy Products (ISP) until the end of 2026. The legislation, Law No. 64/2026, was approved unanimously by Parliament on October 9 and promulgated by President António José Seguro on October 13.

The discount effectively returns the VAT surcharge collected by the State due to rising fuel prices. The measure is retroactive, producing effects from June 30 through December 31, 2026. This extraordinary temporary discount was initially implemented following the start of the war in the Middle East, triggered when price increases exceeded 10 cents per liter for unleaded gasoline and diesel compared to the period of March 2 to 6.