THE WINDFALL TAX on the profits of energy companies will be backdated to before the energy crisis, Tánaiste Leo Varadkar has confirmed. 

Speaking during Leaders’ Questions, he said any tax would be on companies’ profits for the full year of 2022.

His comments come as the Taoiseach says it is still unclear how much money the levy will raise.

Speaking in Tallaght today, at the opening of a new Penney’s store, Micheál Martin said it was “difficult to be precise on the exact amount” of money that may be forthcoming to Ireland.

“It very much depends on the ultimate formula that the EU Council of Energy Ministers will arrive at but there will be a stream of revenue from it,” Martin said.

“We were never going to be dependent on that revenue stream as the key to the package that we will be introducing in the next two weeks.”

He said the “real firepower is in the surplus that we have right now” which he said will get us through the first phase of this crisis, he said.

“We have to be conscious of early spring,” he said, stating that the revenue from EU measures will be helpful in the medium term.

“The European money comes later,” he said. 

Earlier this week, Public Expenditure Minister Michael McGrath said he would like to see some “clarity” as to the amount Ireland might get before budget day on 27 September. 

Martin also confirmed that the windfall tax would be for “wind generation companies” as well as those engaged in fossil fuels.

When asked about the EU proposals by Social Democrats co-leader Catherine Murphy, the Tánaiste said the EU’s proposals on a windfall tax are not yet agreed and “aren’t entirely clear, quite frankly”.

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Murphy said it was only right that the tax would be backdated so as to take into account the “obscene profits” being made. 

Varadkar said that whatever is agreed to at EU level will have an impact here in Ireland, stating that the proceeds of a windfall tax and cap on profits will go to help families  reduce the cost of energy.

He said he absolutely agreed that the way the energy market works needs to be reformed, stating that it made sense in the past to give wind and solar companies the best prices as it was all about encouraging investment. 

No one could have anticipated that gas prices would go so high, he said, adding that renewable energy companies are now making revenues “they never in their wildest dreams thought they would make”.