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Long term strategic planning needed to avoid energy crises in future years – Deloitte

Budget 2023

Commenting on the EU regulation on energy prices in the Minister’s Budget address, Karen Frawley, Tax Partner, Deloitte said:

The proposed EU regulation includes two tax related measures, targeting companies in the energy sector. These measures would cap revenue at a maximum of €180 per MWH on low-cost electricity generating companies whose costs are unrelated to high gas prices – primarily impacting on wind, solar and nuclear producers. In addition, the proposal would introduce an EU wide temporary windfall tax at a rate of 33% over the “surplus taxable profits” of companies in the oil, gas and refinery sectors. While the Minister’s speech noted while Ireland aims to be part of the EU wide response, where this is not possible the Government may look to introduce domestic measures.

Frawley concluded:

In our pre budget submission, Deloitte had identified a range of tax measures to support the renewable energy sector including relief for investment in energy generation, VAT measures to enable better cash flow for renewable energy businesses and enhanced vehicles for solar investment. All of these measures should be considered in earnest as part a longer-term energy plan for Ireland to mitigate against future crises.