# Factbox-Government measures to ease inflation pain
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2022-09-13
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: How Governments Are Tackling Rising Energy and Necessity
Meta Description: Learn how countries like US, Brazil, UK, and more are providing relief to consumers and businesses amidst energy and commodity price hikes.
URL: https://financedigest.com/factbox-government-measures-to-ease-inflation-pain-4html

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(Reuters) – Pandemic-related disruption to global supply chains and the knock-on effects of Russia’s war in Ukraine have combined to drive up prices of energy, commodities and basic necessities.

Below is a list of some of the actions taken by governments aimed at offering relief to hard-hit consumers and companies:

AMERICAS:

\\* The United States will help millions of indebted former students by cancelling $10,000 of their outstanding [student loans](https://www.financedigest.com/student-loans-hurting-workers-ability-to-save-for-retirement.html "STUDENT LOANS HURTING WORKERS’ ABILITY TO SAVE FOR RETIREMENT"). The move follows the $430 billion “Inflation Reduction Act” unveiled last month, which includes cuts to prescription [drug prices](https://www.financedigest.com/bristol-myers-pfizer-abbvie-drugs-likely-to-face-u-s-price-negotiation.html "Bristol Myers, Pfizer, AbbVie drugs likely to face U.S. price negotiation") and tax credits to encourage energy efficiency.

\\* Brazil’s [oil giant Petrobras](https://www.financedigest.com/shell-chevron-and-petrobras-weigh-guyana-oil-auction-bids-sources.html "Shell, Chevron and Petrobras weigh Guyana oil auction bids -sources") on Sept. 1 announced a 7% [cut in refinery gate gasoline prices](https://www.financedigest.com/tesla-cuts-u-s-model-s-and-model-x-prices-between-4-and-9.html "Tesla cuts U.S. Model S and Model X prices between 4% and 9%"), its fourth cut since mid-July. The government in July cut fuel taxes and raised social welfare payments.

\\* Mexico’s government will convene to strengthen its anti-inflation plan, its president said earlier this month. In August [officials estimated that inflation-combatting subsidies have already cost some 575 billion](https://www.financedigest.com/australias-nuclear-submarine-plan-to-cost-up-to-245-billion-by-2055-defence-official.html "Australia’s nuclear submarine plan to cost up to 5 billion by 2055 -defence official") pesos ($29.04 billion) this year.

\\* Chile in July [announced a $1.2 billion aid plan](https://www.financedigest.com/eu-announces-plans-to-lead-green-industrial-revolution.html "EU announces plans to lead green industrial revolution") including labour subsidies and one-time payments for those most affected.

EUROPE:

\\* The European Union is set to unveil new emergency measures including a windfall [profit levy on energy firms](https://www.financedigest.com/polish-e-commerce-firm-allegro-eyes-higher-q1-profit.html "Polish e-commerce firm Allegro eyes higher Q1 profit") and mandatory targets for member states to cut electricity consumption this winter.

\\* The Czech Republic will [cap electricity and gas prices](https://www.financedigest.com/eu-meets-to-try-to-break-gas-price-cap-impasse.html "EU meets to try to break gas price cap impasse") next year.

\\* [Britain will cap consumer energy bills for two years](https://www.financedigest.com/2043-the-year-britain-will-turn-cashless.html "2043: The year Britain will turn cashless") and funnel billions to prop up power companies. The package, announced on Sept. 8 is likely to cost over 100 [billion pounds](https://www.financedigest.com/shell-to-evaluate-25-billion-pound-british-investments-after-windfall-tax.html "Shell to ‘evaluate’ 25 billion pound British investments after windfall tax") ($117.27 billion).

\\* Portugal adopted a 2.4 billion euro aid plan, which cuts VAT on electricity and provides one-off [payments for workers](https://www.financedigest.com/taking-the-pain-out-of-payments-for-the-21st-century-worker.html "TAKING THE PAIN OUT OF PAYMENTS FOR THE 21ST CENTURY WORKER"), families and pensioners.

\\* Croatia will cap electricity prices from Oct. 1 until March.

\\* Germany will [spend at least 65 billion euros](https://www.financedigest.com/europes-spend-on-energy-crisis-nears-800-billion-euros.html "Europe’s spend on energy crisis nears 800 billion euros") ($66.14 billion) on a new package, which includes a windfall tax, benefit hikes and extending public transport subsidies. Berlin had already announced a gas [price levy on consumers](https://www.financedigest.com/investors-warn-big-consumer-firms-over-price-hikes-as-competitors-gain.html "Investors warn big consumer firms over price hikes as competitors gain") from Oct. 1, while in July, it [agreed a 15-billion euro](https://www.financedigest.com/iag-agrees-to-buy-80-stake-in-air-europa-for-400-million-euros.html "IAG agrees to buy 80% stake in Air Europa for 400 million euros") state bailout of Uniper, the country’s largest importer of Russian gas.

\\* Spain will slash value-added tax (VAT) on gas to 5% from 21% from October and has already reduced VAT on electricity twice over the past year to 5%.

\\* Finland and Sweden will [offer billions](https://www.financedigest.com/copper-miner-teck-resources-rejects-glencores-22-5-billion-offer.html "Copper miner Teck Resources rejects Glencore’s .5 billion offer") of dollars in liquidity guarantees to power companies in their respective countries. Sweden in August said it would make 90 billion [Swedish crowns](https://www.financedigest.com/dollar-edges-down-from-six-week-peak-swedish-crown-jumps.html "Dollar edges down from six-week peak, Swedish crown jumps") ($8.56 billion) available to help consumers with record electricity prices.

\\* Italy plans to [spend at least an additional 6.2 billion](https://www.financedigest.com/chipmaker-infineon-ready-to-spend-billions-on-acquisitions-ceo.html "Chipmaker Infineon ready to spend billions on acquisitions – CEO") euros ($6.2 billion) to help households and firms, following around 52 billion euros, which Rome has already budgeted this year.

\\* Denmark in August capped [annual rent increases](https://www.financedigest.com/coca-cola-hbcs-annual-profit-beats-warns-of-price-increases.html "Coca-Cola HBC’s annual profit beats, warns of price increases") at 4% for the next two years in addition to earlier relief measures, including a 3.1 billion Danish crown ($424.29 million) package announced in June.

\\* France’s parliament on Aug. 3 adopted a 20 billion euro relief bill, lifting pensions and some welfare payments, while also allowing [companies to pay higher bonuses tax](https://www.financedigest.com/exxon-sues-eu-in-move-to-block-new-windfall-tax-on-oil-companies.html "Exxon sues EU in move to block new windfall tax on oil companies") free. In August, the [government said it did not rule](https://www.financedigest.com/italys-rightist-government-tightens-rules-for-migrant-rescues.html "Italy’s rightist government tightens rules for migrant rescues") out a windfall tax on companies.

\\* Poland in August approved a new package including [subsidies for heating plants](https://www.financedigest.com/intel-wants-5-billion-more-in-german-subsidies-for-chip-plant-bloomberg-news.html "Intel wants  billion more in German subsidies for chip plant – Bloomberg News"), and a 13.7 billion zloty ($2.96 billion) cash transfer for municipalities to help residents with soaring energy bills. The country had also in July introduced a relief scheme for holders of local currency mortgages.

ASIA:

\\* Japan will present another economic package in October, adding to previous measures including a record minimum wage hike. A $103 [billion relief bill was also passed in April](https://www.financedigest.com/abb-to-launch-1-billion-share-buyback-on-april-3.html "ABB to launch  billion share buyback on April 3").

\\* Indonesia’s President Joko Widodo ordered provincial governments to cut transport costs and offset the inflationary [impact of a fuel price hike](https://www.financedigest.com/oil-falls-as-earthquake-impact-on-crude-eases-rate-hike-fears-rise.html "Oil falls as earthquake impact on crude eases, rate hike fears rise") announced earlier this month, which sparked nationwide protests. Last month, the [government announced it will reallocate 24.17 trillion](https://www.financedigest.com/european-governments-spend-half-a-trillion-euros-on-energy-crisis-report.html "European governments spend half a trillion euros on energy crisis – report") rupiah ($1.63 billion) from fuel subsidies to welfare spending.

\\* India has set up a panel to review the pricing formula of locally produced gas, aiming to ensure “fair price to the end [consumer” and lower inflation](https://www.financedigest.com/euro-zone-consumers-more-optimistic-on-inflation-ecb-survey-shows.html "Euro zone consumers more optimistic on inflation, ECB survey shows"). In May it [imposed restrictions](https://www.financedigest.com/chinas-covid-resurgence-spurs-new-curbs-foxconn-imposes-restrictions.html "China’s COVID resurgence spurs new curbs, Foxconn imposes restrictions") on exports of food items including wheat and sugar, and cut taxes on imports of edible oil.

\\* Malaysia is expected to spend a record 77.3 billion ringgit ($17.15 billion) in subsidies and cash aid this year.

AFRICA AND MIDDLE EAST:

\\* [South Africa](https://www.financedigest.com/inmobi-and-coca-cola-win-mma-smarties-south-africa-award-for-beat-can-campaign.html "InMobi and Coca-Cola Win MMA SMARTIES South Africa Award for Beat Can Campaign") in late July announced a cut in the pump prices of fuels.

\\* Saudi Arabia and the United Arab Emirates in early July [raised their social welfare spending](https://www.financedigest.com/cisco-forecast-raise-allays-tech-spending-fears-lifts-shares.html "Cisco forecast raise allays tech spending fears, lifts shares"). The UAE doubled financial support to low-income Emirati families, while [Saudi Arabia’s King](https://www.financedigest.com/saudi-arabias-king-crown-prince-send-condolences-on-queen-elizabeths-death.html "Saudi Arabia’s king, crown prince send condolences on Queen Elizabeth’s death") Salman ordered the allocation of 20 billion riyals ($5.32 billion).

\\* Turkey in early July [increased its minimum wage](https://www.financedigest.com/greece-to-increase-minimum-wage-again-before-election.html "Greece to increase minimum wage again, before election") by about 30%, adding to the 50% rise seen at the end of last year.

($1 = 19.8034 Mexican pesos)

($1 = 0.8526 pounds)

($1 = 0.9828 euros)

($1 = 7.3063 Danish crowns)

($1 = 4.6248 zlotys)

($1 = 14,850.0000 rupiah)

($1 = 4.5060 ringgit)

($1 = 3.7580 riyals)

($1 = 0.8527 pounds)

($1 = 10.5200 Swedish crowns)

(Compiled by Olivier Sorgho, Leika Kihara, Manoj Kumar, Ina Kreutz and Agnieszka Gosciak; Editing by Alison Williams, Hugh Lawson and Tomasz Janowski)


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