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Windfall taxes on European energy companies 'weakened' by intense lobbying, says new study
euronews (in English)
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30/10/2023
Fossil fuel businesses across Europe have managed to weaken and delay windfall taxes imposed on them during the recent energy crisis, according to a new report by a coalition of environmental associations.
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00:00
tell you about in a minute. Fossil fuel companies across Europe have managed to weaken and delay
00:04
windfall taxes imposed on them during the recent energy crisis. The accusation comes
00:11
from a report by Fossil Free Politics, a coalition of environmental associations that organizes
00:16
protests in Brussels. And every country has a different story. In Italy, energy giant
00:23
Eni saw its net profits more than double due to rising gas prices, but avoided a windfall
00:28
tax of 25% on it, decided by the former government led by Mario Draghi. The law was written so
00:35
badly that all energy companies have appealed legally against this law. And so from the
00:43
initial expected income, which was 11 billion euro, the actual income that was generated
00:50
by the tax was 2.8 billion. In the Czech Republic, the owner of energy company EPH publicly threatened
00:57
to move one of his companies abroad due to the proposed windfall tax initially designed
01:01
to cover profits made from 2022 with 100% tax for that year. They were able to postpone
01:09
the implementation of the windfall tax for 2023. So most of their profits are not taxed
01:16
by the windfall tax. And also they were able to soften it that it's not 100%, but only
01:23
60% from 2023. Spain also saw some troubles in the application of its windfall tax, a
01:30
levy of 1.2% of companies revenues since 2022, when their profits increased by 35%, as this
01:37
activist explains.
01:38
The government of Spain has used this tax in an administrative context that is not yet
01:49
resolved, because what they say is that what the European Union recommended was a tax on
01:55
profits and not on income, and that this harms them.
02:00
In September last year, the EU agreed on a temporary levy on fossil fuel companies applied
02:04
on profits exceeding 20% of a company's average. Activists claim the tax was watered down by
02:10
a fossil fuel lobbying association and put posters on EU institutions headquarters to
02:14
denounce this. The association that represents the sector denies the accusation.
02:19
In an energy crisis, one that is linked to gas supply, I think it's just perfectly normal
02:24
for the gas sector to engage in those discussions with the European Commission in this case.
02:32
For me, it's common sense.
02:35
According to the report called "Cold Homes, Hot Profits", there were over 200 meetings
02:39
between EU officials and fossil fuel lobbyists the year after Russia's invasion. Almost one
02:44
meeting per working day.
02:46
[Music]
02:48
(whooshing)
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