Italy plans to apply a 50% one-off windfall tax next year on surplus income of energy companies that have benefited from the surge in oil and gas prices, a draft of the government's 2023 budget seen by Reuters showed on Nov. 28.
The levy has a rate equal to 50% of the part of 2022 corporate income which is at least 10% higher than the average income reported between 2018 and 2021. It has a ceiling equal to 25% of the value of net assets at the end of 2021.
The scheme is different from the way it was outlined by the Treasury only last week. That version envisaged a 35% tax running from January until July 2023 and calculated on energy companies' net profit, rather than income as in the latest draft.
By 0930 GMT, shares in Eni SpA and Enel were down respectively around 2% and 1.7%, underperforming Italy's blue chip index, but broadly in line with Europe's STOXX index for the energy sector which fell 1.7%.
Rome expects to raise around 2.565 billion euros (US$2.66 billion) from the tax, which follows a framework proposed by the European Commission and replaces a similar levy in force this year which has triggered criticism and refusals to pay from multiple firms.
Under the new terms set in the budget, which has still not been officially released, around 7,000 producers and sellers of electricity, natural gas and petrol products have to pay the amount due by mid-2023.
Energy companies have until this Wednesday—Nov. 30—to make the final payment on the current windfall tax, which has a 25% rate and is calculated on the value of operations subject to VAT sales tax.
Based on the 40% down payment made by the end of August, total revenues are expected to be worth around 5 billion euros, less than half of the Treasury's preliminary estimate.
However, companies that miss the payments still have the opportunity to catch up by paying penalties and interest.
(US$1 = 0.9637 euros)
Recommended Reading
EQT Sees Clear Path to $5B in Potential Divestments
2024-04-24 - EQT Corp. executives said that an April deal with Equinor has been a catalyst for talks with potential buyers as the company looks to shed debt for its Equitrans Midstream acquisition.
Kinetik Launches Delaware Basin M&A Valued at $1.3B
2024-05-09 - Kinetik Holdings will buy Durango Permian infrastructure for $765 million, excluding contingency payments, and sell its interests in the Gulf Coast Express pipeline to AcrLight Capital Partners for $540 million.
EQT Strengthens Appalachian Position in Swap with Equinor
2024-04-16 - EQT, the largest natural gas producer in the U.S., is taking greater control of the production chain with its latest move.
SCF Acquires Flowchem, Val-Tex and Sealweld
2024-03-04 - Flowchem, Val-Tex and Sealweld were formerly part of Entegris Inc.
Global Partners Buys Four Liquid Energy Terminals from Gulf Oil
2024-04-10 - Global Partners initially set out to buy five terminals from Gulf Oil but the purchase of a terminal in Portland was abandoned after antitrust concerns were raised by the FTC and the Maine attorney general.