Electricity and gas taxes: what they are, how they are calculated and how they affect your bill

What taxes are applied to the electricity bill?

The electricity bill includes various items that often cause confusion. Among them are taxes, which are added to the cost of power, energy and regulated costs. Let's see what they are and how they affect the final amount.

VAT applied to electricity (current rate 2026)

From January 2025, electricity VAT returned to the general rate of 21%, which is maintained in 2026. This tax applies to the bill total, meaning not only to the energy consumed, but also to access tolls, charges, additional services and the electricity tax itself.

Special Tax on Electricity (IEE)

In addition to VAT, there is a specific tax for this supply: the Special Tax on Electricity. Its rate is 5.11% and it is calculated on the tax base of the electricity bill (it does not apply to contracted services) before adding VAT. While the percentage is lower, it still adds to the total cost of your bill.

Access tolls and charges

Regulated access tolls and charges are not taxes, although they are often confused with them. These are regulated costs that cover the use of the transmission grids and distribution networks, as well as other components of the electricity system. They form part of the tax base on which taxes are subsequently applied, but they are not taxes in themselves.

Consequently, your electricity bill is a combination of the power cost, usage cost, regulated costs and taxes. First, the access tolls, charges, power and energy usage are added together; then the electricity tax is added and, finally, VAT is applied to the total.

What taxes are applied to the gas bill?

The gas bill, like the electricity bill, includes a series of taxes that increase the final amount. Understanding these taxes helps clarify how your bill is calculated and why it varies from one year to the next.

Hydrocarbon Tax

On your gas bill, this tax appears under the name Special Tax on Hydrocarbons (IEH). Its impact is tied directly to usage.

The tax is applied to the energy used, not to the fixed rate of the bill. For standard domestic usage (heating and cooking), the tax rate is €0.00234 for every kWh used. 

Quick example: If you use 1,000 kWh in a winter month, you will pay €2.34 for this item, plus the corresponding VAT.

Gas VAT (current rate 2026)

From January 2025, gas is taxed at the general VAT rate of 21%, which remains in place for 2026. This tax applies to the standing charge, usage and regulated costs, which means it directly affects the total amount of the bill. During the years 2022–2024, gas VAT was temporarily reduced (to as low as 5%) to mitigate the impact of the energy crisis, but that measure is no longer in force.

Regional or municipal fixed levy

In addition to VAT, some autonomous regions and town councils apply a fixed regional or municipal levy (canon) on gas supply.

• This levy is usually an annual or monthly amount paid regardless of usage.
• Its purpose is to finance certain public services related to energy supply or local infrastructure.
• The amount varies according to the regulations of each territory, so two households with the same usage may see differences in their final bill depending on where they live.

How electricity and gas taxes are calculated (with practical examples)

Taxes are a fundamental part of energy bills and often raise questions. To better understand their impact, let's look at two simple examples: one for electricity and one for gas.

Example 1: electricity bill

Let's imagine a household with monthly usage that generates a tax base of €50 (energy + tolls + charges + services).

• Gross amount (power + energy + tolls + charges): €50
• Tax on electricity at 5.11%: €2.56
• Service: €2.70
• VAT at 21%: €11.60
• Total bill including VAT: €66.86

In this example, taxes add approximately €14 to the initial subtotal.

Example 2: gas bill

Now let's consider a household with a tax base of €50 (standing charge + usage + Hydrocarbon Tax):

1. Tax base: €50
2. Regional/municipal fixed levy: €2 (indicative example, may vary by region).
3. VAT (21%): €10.92
4. Total bill with taxes: €62.92

Here, taxes and levies add more than €12 to the initial amount.

• For electricity, the main taxes are the Special Tax on Electricity and VAT.
• For gas, VAT is the most significant tax, to which a regional or municipal fixed levy is added in some territories.

Consequently, taxes can represent between 21% and 25% of the bill total, depending on usage and the applicable regulations.

Recent changes to energy taxes (update)

In recent years, taxes on electricity and gas have undergone several modifications to mitigate the impact of the energy crisis:

• 2021–2024: Temporary VAT reductions were applied (10% for electricity and down to 5% for gas) to alleviate the price rise.
• From January 2025: Both electricity and gas returned to the general VAT rate of 21%, which remains in 2026.
• The Special Tax on Electricity (5.11%) was never reduced, although it makes up a smaller proportion of the bill.
• In the Canary Islands, IGIC applies instead of VAT, with reduced rates (3% and 7% depending on the item).

Furthermore, the proposed order on charges specifies how the breakdown of regulated costs (such as renewable energy funding and system costs) must be displayed on the bill. This means the customer will be able to see more transparently which part of their bill goes to each item. On the other hand, the specific charges for the 6.2TDVE tariff, designed for electric vehicle charging points, have not yet been defined.

Can taxes on electricity or gas be reduced?

Energy taxes are regulated by law and can only be modified through a political decision by the Government; energy companies do not have the power to change them. In the past, as happened in 2021, temporary reductions were approved to alleviate price pressure; however, no new reductions are planned for 2026, although extraordinary measures could be adopted if exceptional circumstances were to occur in the energy market.