Italy imposes 25% windfall tax on energy companies

Italy will tax the profits of energy companies at 25 per cent to help fund a support package for consumers and businesses that have been hard-hit by soaring energy costs, the Rome government has announced.

The tax is a hike from an existing 10 per cent windfall tax imposed in March on the profits of energy companies, which have risen as the price of oil and gas have soared on international markets.

The Italian government approved the measure late on Monday along with a €14 billion aid package that includes tax breaks for energy-intensive industries and payments of €200 to about 28 million Italians who have incomes of €35,000 and below.

Prime minister Mario Draghi said the balance of taxes and payments meant the package would not add to Italy’s deficit.

German leadership more important than ever in Russian crisis, says Finland

---

Odesans join forces to help their city, their country and compatriots in need

---

Russian TV report showing devastation of Ireland condemned by Martin

---

‘This is Ukraine’s finest hour,’ Boris Johnson tells Kyiv parliament in address

---

“Today’s measures address the cost of living. Price inflation is dependent to a very large extent on energy prices, and this means that it is a temporary situation that must be faced with exceptional tools,” Mr Draghi told reporters.

The package also included discounts on public transport for students and commuters, and reforms to speed up a transition to renewable energy.

“This will allow us to become independent from Russia’s gas,” Mr Draghi said. Russian supplies account for about 40 per cent of Italy’s gas imports.

In an address to the European Parliament in Strasbourg on Tuesday, the Italian premier called for further integration of the European Union and the streamlining of its decision-making to allow for swifter action in foreign policy matters. Instead, decisions should be taken by qualified majority support, he said. This requires 15 out of 27 member states to vote in favour, representing at least 65 per cent of the total EU population.

Cheap loans

Mr Draghi argued that the EU should build on the common borrowing programme it first undertook during the Covid-19 pandemic to counteract economic downturn, and extend the Sure scheme – introduced as an unemployment insurance measure – to provide cheap loans to member states to fight the energy cost crisis.

The EU should abandon the requirement for unanimity in foreign policy decisions – which allows a single member state to veto matters agreed by the other 26 – to allow the bloc to act more swiftly and be “more credible” internationally and to its citizens.

He called for more co-ordination on defence spending between EU member states, describing the current situation as “a profoundly inefficient distribution of resources”.

The Italian prime minister backed the reform of EU treaties to achieve the required changes if necessary.

“The institutions set up by our predecessors over the past decades have served Europe’s citizens well, but they are inadequate given the reality that confronts us today,” Mr Draghi said.

“We need a pragmatic federalism: one that encompasses all the areas affected by the transformations taking place – from the economy, to energy, to security.”