Six EU countries push for windfall tax on oil companies amid surging war profits

Six EU countries are intensifying calls for a bloc-wide windfall tax on oil companies as profits surge amid the war in the Middle East, according to a letter seen by Euronews.

The finance ministers of Germany, Italy, Austria, Poland, and Portugal, along with Spain's economy minister, sent a joint letter to Ireland's finance minister, whose country holds the rotating EU presidency. The ministers urged that a levy be added to the agenda for next month's meeting of EU finance chiefs in Dublin.

"Oil companies are enjoying overall profitability and margins on refined products that exceed the rise in crude oil prices," the letter stated. "We are experiencing one of the biggest supply shocks in decades, and all over the world, there is growing discontent about the rise in the cost of living."

The signatories called for debates on an "EU-wide framework to tax windfall profits," urging the bloc to draw on lessons learned from the temporary levy introduced in 2022 following Russia's invasion of Ukraine.

'Energy firms must not exploit consumers'

German Finance Minister Lars Klingbeil has repeatedly argued that energy firms must not exploit consumers during the current turmoil, with a ministry source emphasising that "excessive crisis profits must be returned to consumers."

Several of the signatory nations had already advocated for a tax on oil company profits earlier this year. Energy giants have posted massive earnings since the US and Israel launched military operations against Iran in February, severely disrupting shipping through the vital Strait of Hormuz transit route.

Despite the pressure, the EU has not yet signalled plans to introduce a new levy on oil firms.

Political divisions also persist within individual member states. In Germany, while Klingbeil's centre-left SPD supports the windfall tax, Chancellor Friedrich Merz's centre-right CDU opposes the measure.