Spanish Prime Minister Pedro Sánchez announced on Tuesday, July 19th, that the government would impose a temporary tax on banks and energy companies in the country, aimed at mitigating the effects of high inflation and utility costs amid Russia’s war with Ukraine. Electricity prices in Spain hit a record high this year as wars disrupted supplies in several countries, with the country’s inflation rate hitting 10.2% in June, its highest level in 37 years.
According to the Spanish government, taxes are expected to generate $7 billion over the course of two years. The money would cover free fares for short and medium-distance trains between September and December, an additional $2 billion for current scholarship recipients and the construction of 12,000 homes in Madrid.
Passengers will be eligible for a free multi-trip ticket operated by Renfe, a Spanish state-run company. This exemption comes after the government gave a 50% discount to reduce commuting costs in June. The country’s labour ministry said they believe the move would lead to more than 75 million free train journeys.
