The Spanish government wants an exceptional tax on banks and energy companies

MADRID (AP) — The Socialist-led coalition government in Spain wants big energy companies and banks to pay a windfall tax, which officials hope will raise about 7 billion euros (dollars) over two years.

The government submitted its proposal to parliament on Thursday. A debate and vote by lawmakers was scheduled after their summer recess.

Officials say the tax would apply to about 20 large corporations that would be barred from passing the cost on to customers. Under the government’s proposal, oversight bodies would monitor companies’ compliance.

Britain and Italy have adopted similar windfall taxes. Energy companies posted windfall profits as oil and natural gas prices soared in the wake of Russia’s war in Ukraine.

The Spanish government said proceeds from its tax would help pay for measures to ease a cost-of-living crisis, including high energy bills.

The proposal asks energy companies with more than one billion euros (dollars) in revenue in 2019 to pay an additional tax of 1.2% on revenue this year and next year. The government hopes to raise 4 billion euros (dollars).

Financial institutions are expected to provide 3 billion euros through a 4.8% tax on their net interest and customer charges.

Edward N. Arrington