In this week’s batch of corporate results, many companies use the earnings stage to address tax policy. With the looming possibility of another PSOE-Sumar government backed by minority forces, observers watched for any signals about planned tax changes targeting banks and energy firms, along with broader corporate tax increases. Projections suggested an extra up to 10 billion euros in revenue. Repsol, which posted a profit of 2 billion 785 million euros through September—about 14 percent higher than the prior year—responded strongly to the PSOE-Sumar pact this week, warning that sizeable projects could move out of Spain if the agreements stay in place. The message landed most loudly on the parts of the business that generate significant revenue for the company in Spain, particularly electricity suppliers and banking services. On the other side, Antonio Garamendi, head of the Confederation of Employers’ Organizations (CEOE), challenged the government program unveiled by Pedro Sánchez and Yolanda Díaz. He argued that the real issue is the implementation of populist measures that would hurt corporations. His comments came during media briefings at the XXII CEDE Executives Congress in Granada, Andalusia.
Garamendi also criticized the plan to reduce the standard work week to 37.5 hours in 2024, a centerpiece of the PSOE-Sumar policy announced on Tuesday. He noted that many company agreements with workers already reflect a 37.5-hour framework, and forcing this into law would constitute interventionism and populism. The effect, he warned, would hit rural areas, retail, and hospitality sectors hardest. The CEOE president’s remarks were echoed by Isidro Fainé, head of the La Caixa Banking Foundation and the CriteriaCaixa holding company, who pointed to the current political climate as unsettled and destabilizing for the business landscape in Spain. He described a market where complexity and uncertainty are the two defining traits, likely to intensify going forward.
Repsol indicated that the energy sector tax could be extended beyond its initial term this Thursday, arguing that the tax penalizes firms that invest in assets, create jobs, and secure Spain’s energy independence. The levy, together with a separate banking tax, imposes a 1.2 percent levy on the income of energy and banking companies for 2022 and 2023, based on reported figures for those years, translating into an impact of about 444 million euros in the first year of implementation. This tax structure has been framed by supporters as a way to ensure a fair contribution from profitable sectors, while critics label it punitive toward investment and growth in crucial industries.
The banking sector has also voiced concerns about the introduction of extraordinary taxes on income and net banking commissions. Banco Santander’s chief executive, Héctor Grisi, described the impact as significant and argued that the tax is discriminatory because it targets income rather than profit. He stressed that the bank’s earnings for January through September rose by about 11.3 percent to reach 8.143 billion euros, marking the strongest nine-month result in the institution’s long history. He cautioned that if the tax remains, it could constrain credit access during a weak economic cycle. Grisi added that the goal should be tax parity across all companies, rather than piling on more duties for a single sector.
Bankinter’s chief executive, María Dolores Dancausa, also spoke last week about the desire for the extraordinary banking tax to end after its planned two-year term, regardless of which party forms the government. She urged a stable policy environment and warned that changing the rules would generate legal uncertainty and negative news for markets. Bankinter’s board reiterated its view that the tax is unfair, noting a 77.5 million euro payment in the current year and explaining that because the levy targets the interest margin, the charge next year will scale with this year’s results. That dynamic would push anticipated annual tax payments higher if current conditions persist.