Portugal Imposes Windfall Tax on Oil Companies Amid Rising Fuel Prices

The Portuguese government has approved a temporary solidarity contribution on the oil sector, targeting companies that have seen significant profits from rising fuel prices. The levy will apply to corporate profits that exceed the average recorded in previous years and will fund measures to mitigate the impact of fuel costs on households and vulnerable economic actors.

The new tax is part of a broader effort by European Union finance ministers to establish a similar contribution instrument, as called for in a joint letter sent to Brussels in April. The Portuguese Finance Minister has joined counterparts from Germany, Spain, Italy, and Austria in requesting the EU to rapidly develop a windfall tax on energy companies' profits.

Galp, which operates in the crude oil and refining sectors, announced a 44% increase in profit for the first half of the year compared to the same period last year, reaching €812 million. The growth was driven by increased oil production in Brazil and a higher average Brent crude price.