Minister accused of giving EDP €300 million fiscal freebie over sale of Portuguese hydropower dams

A citizens’ movement in northern Trás-os-Montes has accused Portugal’s minister of the environment and climatic action of giving electricity company EDP a ‘fiscal freebie’ worth around €300 million.

At issue is the sale last year by EDP of six hydropower dams to a French consortium headed up by energy company Engie.

The sale of the dams (Miranda, Bemposta, Picote, Baixo Sabor, Feiticeiro and Foz Tua) has already seen both Left Bloc MPs and the centre right PSD query the terms of the ‘deal’, which both believe ‘lacks transparency’.

The Cultural Movement of Terra de Miranda (MCTM) has gone a step further.

A working group created by the government to “analyse the impact of the sale of the six dams” has by coincidence (?) convened for the first time today, in Miranda do Douro, in the district of Bragança.

But MCTM’s claims have preceded it. 

The movement says the fiscal freebie is clear for everyone to see – and doesn’t simply impact on the citizens of ‘Terra de Miranda’ but on every single taxpayer in the country.

An open letter addressed to environment minister João Pedro Matos Fernandes, accuses him of “knowing of the subterfuge of fiscal planning used by EDP to avoid the payment of taxes” but doing nothing to stop it.

In fact MCTM stresses there is still a way of ensuring receipt of the tax that should have been paid, by actioning the “anti-abuse clause foreseen for this type of business”.

Local newspaper O Minho doesn’t fully explain why the non-payment of €110 million in stamp duty morphs into a ‘fiscal freebie’ of €300 million, but negocios online repeats MCTM’s claims today, citing member José Maria Pires affirming “Portuguese people have lost hundreds of millions of euros, which were ‘gained’ by those who sold”.

Minister Matos Fernandes however has said this afternoon that there was good reason for EDP not paying stamp duty. The way he sees it, it wasn’t due. This was a “corporate deal through a concessions which is the State”, he told reporters.

In statements that could show Matos Fernandes’ may be prepared to ‘see another point of view’, he said: “The AT tax authority will pronounce on the matter in question during 2021. In the case of the sale of the dams, the value rounds out at around 100 million euros and if it has to be paid, it will be paid. This period of payment will start to count from January 21 2021”.

Says negocios online: “the minister ended by making it clear that everyone who thought the sale of the six Transmontano dams to an international consortium led by the French Engie shouldn’t have been done in 2020 were “either mistaken or trying to deceive someone”.

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