EU Studies Windfall Tax on Oil and Gas Companies

en.Wedoany.com Reported - On October 12, Wopke Hoekstra, the European Commissioner for Climate and Taxation, said in Luxembourg that the EU is studying an excess profit tax on oil and gas companies covering all member states and is setting up a dedicated working group. The working group will assess the feasibility, potential revenue, and legal obstacles of a unified tax measure. Six countries—Germany, Spain, Portugal, Italy, Poland, and Austria—have called on the EU to study relevant tax arrangements.

Since 2026, international oil and gas prices have continued to rise due to Middle East conflicts and transportation disruptions. Brent crude oil futures prices approached $120 per barrel in late April and, as of October 12, were still up more than 70% from the beginning of the year. Wopke Hoekstra said that rising energy prices have increased expenses for households and businesses, while some oil and gas companies have gained relatively high profits without increasing the supply of products or services.

The EU implemented a temporary solidarity contribution system in 2022 targeting oil, natural gas, coal, and refining companies. The system levied a temporary tax of at least 33% on the portion of taxable profits exceeding 120% of the average taxable profits from 2018 to 2021, applicable to fiscal years 2022 and/or 2023. European Commission data show that the measure collected nearly €29 billion in total.

The previous temporary tax measure also sparked legal disputes, with companies including ExxonMobil challenging the relevant system, and some lawsuits remain unresolved. Wopke Hoekstra said that when studying a new round of tax measures, the EU will review the legal disputes over the existing system and the legal basis for new measures.