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Windfall tax on electricity companies set for Cabinet sign off today

By November 23, 2022No Comments

The Government is expected to agree to cap the revenues of electricity generating companies which do not use gas.

The Cabinet is also set to sign off on a plan to get firms producing fossil fuels to pay a solidarity contribution.

After months of consideration, the Government will today finalise plans to tackle windfall gains in the energy sector.

It is likely that wind and solar electricity generating companies will have market revenues capped at €120 per megawatt hour.

Any revenue gains above this mark will have to be paid to the Exchequer for the duration of this initiative.

Companies actively involved in the production of fossil fuels could see a proportion of their taxable profits paid in a solidarity contribution.

This would be a temporary move and would be in place for both this year and next year.

It could see companies with the highest taxable profit being required to pay up to 75% of this figure towards the solidarity contribution.

These measures are in line with the European Council regulation which aims to keep profits down and to support struggling energy customers.

Money generated from the solidarity contribution should be used to help households and companies most affected by soaring energy prices, the council says.

It has been estimated previously that this move to cap windfall gains could generate up to €1bn in revenue for the State.

Article Source: Windfall tax on electricity companies set for Cabinet sign off today – Mícheál Lehane – RTE

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