Italy to raise billions with windfall tax on energy companies

Robert Besser
30 Nov 2022, 16:21 GMT+10

Italy plans to charge energy companies that have benefited from the surge in oil and gas prices with a 50 percent one-off windfall tax on profits next year
The levy has a rate equal to 50 percent of their 2022 corporate income, some 10 percent higher than the average income reported between 2018 and 2021
It also has a ceiling equal to 25 percent of the value of net assets at the end of 2021

ROME, Italy: A draft of the government's 2023 budget seen by Reuters indicates that Italy plans to charge energy companies that have benefited from the surge in oil and gas prices with a 50 percent one-off windfall tax on profits next year.

The levy has a rate equal to 50 percent of their 2022 corporate income, some 10 percent higher than the average income reported between 2018 and 2021. It also has a ceiling equal to 25 percent of the value of net assets at the end of 2021.

After the release, shares in ENI and Enel were down some 2 percent and 1.7 percent, respectively, below Italy's blue chip index, but broadly in line with Europe's STOXX index for the energy sector, which fell 1.7 percent.

Rome expects to raise some $2.66 billion from the tax, which replaces a similar levy in force this year that caused criticism and refusals to pay from multiple firms, and follows a framework proposed by the European Commission.

Under the new terms, some 7,000 producers and sellers of electricity, natural gas and petrol products must pay the amount due by mid-2023.

Energy companies have until 30th November to make the final payment on the current windfall tax, which has a 25 percent rate and is calculated on the value of operations subject to the VAT sales tax.

Based on the 40 percent down payment made by the end of August, total revenues are expected to be worth around $5 billion, which is less than half of the preliminary estimate of the Treasury.

Watch latest videos

News RELEASES

Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Baton Rouge Post.

More Information

78 ℉

Mostly Cloudy in Baton Rouge

Business

Section

Across-the-board rally on U.S. stock markets Friday

NEW YORK, New York - U.S. stocks extended their rally on Friday despite remarks by Federal Reserve Chair Jerome Powell ...

Currency issues affect Russia's oil trade with Asia

MOSCOW, Russia: Russia's trade in oil with India, one of the most lucrative oil trade routes since the imposition of ...

Experts decry New Zealand government move to lift tobacco ban

LONDON - Health experts and tobacco campaigners have strongly criticized New Zealand's decision to repeal laws that aimed to ban ...

Tech stocks slide while Dow Jones hits high for 2023

NEW YORK, New York - The Dow Jones index was the standout on U.S. financial markets on Thursday with a ...

US shoppers spend $38 billion online during Thanksgiving weekend

WASHINGTON D.C.: Despite the ongoing economic uncertainty, major discounts during the Thanksgiving weekend enticed U.S. shoppers, who spent some US$38 ...

Thailand will downgrade growth forecast for 2023 to 2.7 percent

BANGKOK, Thailand: This week, Thailand's Deputy Finance Minister Krisada Chinavicharana said after a weaker-than-expected third quarter, the country will downgrade ...

World

Section