Spain’s government is slashing energy taxes as part of a package of measures aimed at reducing domestic electricity costs, which have hit record highs in recent months.
Prime Minister Pedro Sánchez said his government wanted to reduce the “extraordinary benefits” of energy companies under current finance and energy regulations.
Sánchez told public broadcaster RTVE in an interview late Monday that the goal is to transfer fiscal benefits to consumers and face a potentially sharp rise in natural gas prices.
According to private Spanish news agency Europa Press, wholesale electricity prices are 250% higher than a year ago.
Galloping prices have brought public anger and pressure from consumer unions on the government.
Sanchez said his government intends to eliminate the 7% tax on electricity generation, among other measures. Utility companies pass the cost of that tax to their customers. A separate energy tax to be reduced from 5.1% to 0.5%
More details are to be announced after the cabinet meeting on Tuesday.
The measures eased stock prices of energy companies on the Madrid Stock Exchange on Tuesday. Shares of Spain’s largest energy company Endesa fell 1.7% in early trade.