Cap put on subsidized appliance replacement profit margins
An amendment tabled in Parliament on Tuesday, attached to a Finance Ministry bill on special consumption taxes, will cap maximum profit margins for the sale of domestic appliances subsidized under the Development Ministry’s “Change my appliance” program.
The scheme seeks to encourage a switch to more energy efficient models by offering a subsidy to buy new appliances in exchange for the withdrawal of the older appliances, such as air-conditioning units, refrigerators and freezers.
The cap restricts gross profits on the sale of each appliance to the equivalent profit per unit up until December 31, 2021 in a bid to avert price-gouging, protect consumer purchasing power, ensure the maximum effectiveness of the program and that the benefits go to consumers.
The cap will apply for the duration of the “Change my appliance” plan and violations carry escalating penalties, starting from a warning to stop overcharging to fines that range from 5,000 to 1 million euros.
The same amendment also extends a law allowing the government to publicize the names of companies that violate the excessive profits restrictions in times of crisis until the end of the year.
