Many European countries are competing to levy energy "windfall profits tax"
According to Reuters, in order to curb the pressure on the public from rising energy prices, the British government announced on May 26 that it would impose a 25% tax on energy profits from oil and gas producers, while introducing a 15 billion pound (about 15 billion pounds) tax. 127.9 billion yuan) package to support British households struggling to afford skyrocketing energy prices.
As global energy prices soar, many European countries have levied "windfall profits tax" on well-earned energy companies to subsidize the "household bills" of the people's soaring energy expenditures.
Expert analysis pointed out that the collection of "windfall profits tax" is an "emergency" way for Europe to deal with the current rising energy prices and economic and people's livelihood problems. In the long run, it is the general trend for Europe to accelerate green transformation.
Subsidizing households to curb inflation
British Chancellor of the Exchequer Sunak said that the British people are facing a "cost of living crisis", and energy companies are making huge profits, so the British government decided to adopt this "temporary" profit tax policy to raise about 100% for the British government in the next 12 months. £5bn of funding, which will go towards energy subsidies for UK households.
The energy profit tax will be phased out when oil and gas prices return to "normal levels" in the future.
On the day the UK announced the imposition of a "windfall profits tax", the Hungarian government also announced that it will impose a total of 800 billion forints (about 14.4 billion yuan) in excess profits tax this year and next year for companies in the financial, energy and other industries to curb currency. Inflate and fund defense spending.
As early as January this year, the Italian government approved a budget of nearly 30 billion euros (about 217.1 billion yuan) to help offset rising electricity, natural gas and gasoline prices.
Of this, about 11 billion euros will come from a "windfall profits tax" imposed on energy companies to increase profits.
Bulgaria, Italy, Romania and Spain have all imposed new taxes on the energy sector since energy prices began to soar in 2021, according to The Economist.
On March 8 this year, the European Commission recommended that governments try to get a "partial return" from generators.
Alleviate the pressure of people's life
According to data from the Office for National Statistics, from February to April this year, the country's consumer price index rose by 6.2%, 7% and 9% year-on-year respectively, reaching the highest point since the 1980s.
At the same time, energy companies have reaped huge profits from rising energy prices.
In the first quarter of this year, Shell's net profit reached 7.116 billion US dollars, a year-on-year increase of 25.7%, breaking its quarterly profit record since 2008.
In an interview with this reporter, Jin Ling, deputy director and researcher of the Institute of European Studies of the China Institute of International Studies, pointed out that in the face of the recent rise in energy prices, the EU has always hoped to increase the corresponding financial support to alleviate the impact of rising energy prices on enterprises and the public. impact, reduce the drag on economic recovery from energy shortages, and avoid greater political and social instability.
However, since the outbreak of the new crown pneumonia epidemic, the economies of EU countries have been severely impacted, and large-scale subsidies have overwhelmed national finances.
Therefore, many governments levy "windfall profits tax", which can fill the budget gap on the one hand, and respond to the needs of the people on the other hand.
After all, energy "windfall profits tax" can be seen as a way to indirectly achieve socially equitable distribution.
Green transition is more urgent
The energy "windfall profits tax" in many European countries has also aroused doubts and criticisms from industry insiders.
The Economist published an article saying that imposing a "windfall profits tax" was a mistake.
In 2020, the global energy industry has already experienced a year of operating losses, and oil prices once fell into negative territory.
Businesses lose viability if they take the price of an economic downturn, but profits are captured when prices rise.
"The 'windfall profit tax' is aimed at the unreasonable income of some energy companies under special circumstances. Therefore, relevant tax policies will be adjusted with changes in the environment and will not be a long-term policy choice for many European countries. But the problem must be fundamentally solved. , the EU needs to comprehensively consider its energy transition goals and realistic conditions.” Jin Ling analyzed that the impact of energy “windfall profits tax” on the European energy industry chain should be viewed within the framework of Europe’s green transition.
Before the Russian-Ukrainian conflict, the global trend of rising energy prices had begun to emerge.
After the Russia-Ukraine conflict, soaring energy prices exposed the fragility of the European energy supply chain and highlighted the urgency of the EU's green transition.
Jin Ling said that while the overall direction of the energy transition strategy remains unchanged, the EU needs to comprehensively analyze the following factors: first, how to play the role of market mechanisms in promoting energy transformation, and the core is the issue of reasonable carbon prices; second, consider traditional energy, especially The question of the cost-effectiveness of LNG is how soon Europe can reduce its reliance on external energy sources and find corresponding alternatives without compromising climate change goals.