# Spain readies new tax on electric utilities’ profits
Published: 2022-06-21
Category: Headlines
Category URL: https://blockchaintribune.com/category/headlines/
Meta Title: Spanish Government Readies New Tax on Electricity Profits
Meta Description: Learn about the Spanish government's proposal to implement a tax on electricity utilities' profits due to rising energy prices and the need for additi
URL: https://blockchaintribune.com/spain-readies-new-tax-on-electric-utilities-profits/

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MADRID (Reuters) -The Spanish government is readying a new [tax](https://blockchaintribune.com/france-backs-global-minimum-tax-on-billionaires-at-g20/) on electricity utilities’ profits, which have been boosted by energy prices, Budget Minister Maria Jesus Montero said on Tuesday.

“Since profits of electric [utilities](https://blockchaintribune.com/analysis-europe-stock-pickers-go-old-school-to-ride-the-next-wave-in-ai/) have been exorbitant, from the government’s point of view, we want to be able to ask them for a higher contribution,” she said in an interview with public broadcaster TVE.

She declined to give details on the new tax or a time frame, adding that officials at the ministry are working on the technicalities.

Electricity prices have risen significantly over the past year-and-a half in Spain as a result of the solid demand caused by the post-pandemic economy rebound and, later, the consequences of the war in Ukraine on the international gas price.

The government has tried to mitigate the electricity price increase through value-added tax cuts and putting a cap on natural gas for use in power generation with limited success.

It expects to extend measures to curb energy [prices](https://blockchaintribune.com/euro-zone-aug-producer-prices-edge-up-month-on-month-as-expected-plunge-year-on-year/) that include billions of euros in direct aid and soft loans by three months before the end of the month.

Montero said the tax on electric utilities would be a way to finance the high cost of the measures passed by the government, which she estimated at between 10 billion euros ($10.56 billion) and 11 billion euros.

Shares of the main Spanish power utilities Iberdrola, Endesa and Naturgy were down respectively by 1.9%, 2.4% and 2.4% on Tuesday morning, while the IBEX-35 blue chip index was almost unchanged.

The [utilities](https://blockchaintribune.com/analysis-europe-stock-pickers-go-old-school-to-ride-the-next-wave-in-ai/) have said they do not benefit from higher wholesale market prices because they fix their rates in advance and that government intervention could prevent longer-term investment needed to drive the energy transition plans.

($1 = 0.9471 euros)

(Reporting by Inti Landauro; Editing by Emma Pinedo, David Evans and Angus MacSwan)


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