Spain Taxes Banks and Energy Companies to Make Trains Free for 4 Months

New windfall taxes on banks and energy companies in Spain will be used to fund free train travel, boost youth scholarships and build new homes.

Short and mid-distance trains will be free between September and December, an additional €100 will be given to a million scholarship holders at schools and universities, and 12,000 homes will be built in Madrid, Spain’s Prime Minister Pedro Sánchez announced on Tuesday.

The new measures are designed to counteract the impact of the cost of living crisis. Countries around the world are experiencing high inflation and rising energy and food prices, a situation exacerbated by the war in Ukraine.

“I’m going to work myself to the bone to defend the working class of this country,” Sánchez said. 

The taxes are anticipated to bring in €7 billion (about £5.9 billion) in 2023-2024 after Spain’s inflation rate hit 10.2 per cent in June – its highest level in 37 years. Stocks for Spanish banks have fallen sharply as a result.

The trains that travellers will be able to get free multi-journey tickets for are those operated by Renfe, Spain’s state-owned company. The new discount comes after a 50% discount was already applied in June to support commuters. 

While single tickets will not be included in the discount, multi-trip tickets and train passes can be used by more than one person. 

Sources from the Ministry of Labour told the newspaper El País that they believe this will lead to over 75 million free train journeys.