Live News Updates: Ireland considers windfall tax on energy profits

Ireland is considering a windfall energy tax in next month’s 2023 budget given the “significant profits” made by companies in the sector, Prime Minister Micheál Martin said.

“The government will consider a number of issues and look into the question of an extraordinary tax,” he told reporters on Thursday, adding that companies in the energy sector were making “significant profits”.

Compared to other EU countries, Ireland is less affected by the energy crisis that arose from Russia’s invasion of Ukraine, as it does not receive piped gas from mainland Europe. As such, a block-wide unit deactivation has recently been ensured to reduce power consumption.

But inflation is at 9.1%, an almost 40-year high, and the Irish government has already presented the budget to accelerate cost-of-living relief.

This week, the government reported a fiscal surplus of €5 billion at the end of July and a 23.5% rise in tax revenue to €8.3 billion, boosted by strong growth in corporation tax, income tax and VAT. This has provided Ireland with a buffer, while other EU countries, such as Spain, have proposed temporary windfall taxes on banks and energy companies.

Martin said the energy crisis caused by the war in Ukraine meant that liquefied natural gas “simply needs to be considered” in Ireland. A proposed Shannon LNG project has met with fierce opposition from the Green Party, one of the members of the ruling coalition.

“All of Europe is looking at LNG,” Martin said. “LNG using fuel that is not derived from fracking is consistent with the Government Programme,” he added, referring to the coalition’s political project.



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About the Author: Chaz Cutler

My name is Chasity. I love to follow the stock market and financial news!