Romanian Government has approved an Emergency Ordinance introducing a solidarity tax on the profits of oil and natural gas producers and oil refining companies, aiming to raise almost 800 million euros to the state budget in 2023.
The Government said that introducing a solidarity contribution of 60 % of taxable profits that exceed by more than 20 % the average profits recorded in the 2018-2021 period aligns with EU legislation adopted in October.
At least 70 % of the collected revenues will be used to finance strategic investments in energy efficiency projects and/or green energy generation capacities. Proceeds from the solidarity contribution will also be used to finance support schemes for end-consumers, especially for vulnerable households, in order to mitigate the impact of price increases.
In response to the Government’s announcement, Romania’s Oil and Gas Employers’ Federation (ROPEPCA) said that the new tax will endanger future investments. The oil and gas sector is already overtaxed, as the average tax rate on natural gas revenues is over 60 %, plus an 80 % tax on additional revenues obtained as a result of deregulation of natural gas sector prices, tax on additional offshore revenues.
