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Spanish federal government extends energy windfall tax by decree

The Spanish federal government has issued a decree extending a momentary tax on energy business into 2025, Prime Minister Pedro Sanchez stated on Monday, after lawmakers voted last week to eliminate the levy.

The decree participates in force on Jan. 1, but it will need to be validated by parliament within one month in order to stay valid throughout next year as the minority federal government means - which may prove hard to attain as its partners to the left and right are at chances on the concern.

Sanchez said that with the extension, Madrid was supporting the commitments made to its partners, as it required an extra. effort from energy business while at the very same time introducing. a tax reward which thinks about strategic. financial investments that are important for decarbonisation.

The tax credits had actually been demanded by the centre-right. Catalan separatist celebration Junts and Basque nationalists PNV, who. argue that the levy impacted financial investments in their respective. regions.

Energies have alerted that extending the levy, of 1.2%. for companies with a turnover of a minimum of 1 billion euros ($ 1.04. billion), would jeopardise 30 billion euros in renewable resource. investments.

The temporary tax was developed in 2022 and aimed at alleviating. cost-of-living pressures for regular Spaniards as companies acquired. from a surge in energy rates following the war in Ukraine.

In its last conference of the year, the cabinet likewise. extended by six months the short-lived subsidies that allow public. transport rates to be offered at a discount, Sanchez said.

In addition, the ministers authorized a 2.8% increase in. pensions that would benefit some 12 million senior citizens, he included.

(source: Reuters)