The government wants people to use energy more sparingly and efficiently, so it taxes the use of electricity and natural gas. Tax makes energy more expensive, which encourages people to use less energy.
Paying energy tax
You pay energy tax to your energy supplier, which in turn pays it to the Tax and Customs Administration.
Energy tax credit
A tax credit applies to each electricity connection. This is because up to a certain amount, energy use is regarded as a basic need. You pay no energy tax on this basic amount. For 2016, the tax credit is €310.81 (excluding VAT). The government sets the amount of the tax credit each year.
How the tax credit works
The energy supplier deducts the tax credit from your energy bill. Even if your annual energy tax is less than the tax credit, the full amount of the tax credit is still deducted from your bill. The same applies to green energy. If you move part way through a billing period, you receive a proportion of the tax credit.
Energy tax refund
In some cases businesses can get an energy tax refund. For instance if they use natural gas and electricity to generate their own electricity.
People who share an electricity connection can also qualify for a refund. For instance if a house is split into two or more flats.
No exemption from or refunds of energy tax for people with high heating bills
Private individuals with high heating bills can’t be exempted from or get refunds of energy tax. If your heating bill is larger than normal due to old age, handicap or illness you can’t get a refund of energy tax. But if you find it difficult to pay your heating bills, you may qualify for special assistance from your municipality. You can get more information about this from your municipality.
Energy tax revenue
The government uses the revenue from energy tax to reduce other taxes. Like the taxes on work (for instance income tax) and on profit (for instance corporation tax).