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Portugal Finally Gives in to Windfall Tax on Energy
The Portuguese Government has finally agreed to impose a windfall tax on the energy sector after repeatedly rejecting the idea. The decision follows the announcement by the European Union (EU) to impose a Union-wide tax on the profits made by the sector during the ongoing energy crisis.
Earlier in September, the Portuguese Prime Minister and leader of the ruling center-left Socialist Party — António Costa — reportedly rejected a windfall tax on the energy sector. A decision which was not only criticized by left-wing parties, but that also faced internal opposition — with members of his own party saying that the subject had not been properly discussed.
Those in favor of a windfall tax argue that energy companies are profiteering from the energy crisis, a sentiment echoed by António Guterres, the Secretary-General of the United Nations and former Portuguese Prime Minister for the Socialist Party as well.
To support their argument, critics point to the €420 million made in profits by the Lisbon-based energy company Galp during the second semester of 2022 — which represented a 153% increase from the same period last year. Superseding the increase of 54% reported by the Spanish Repsol, which also has a strong presence in Portugal.
