Portugal and five other EU countries want ministers to discuss a common windfall tax on energy profits

Portugal and five other EU countries want finance ministers to discuss a common approach to taxing extraordinary profits in the energy sector at the next ECOFIN meeting in September, in a move that could shape how Europe responds to higher energy costs for households and businesses. The position was set out in a joint letter signed by Portuguese Finance Minister Joaquim Miranda Sarmento and his counterparts from Germany, Spain, Italy, Poland and Austria.

According to Reuters, which had access to the letter sent to Ireland as holder of the rotating presidency of the Council of the European Union, the six countries want the issue raised at the September 18-19 ECOFIN meeting in Dublin. In the letter, the ministers said Europe is facing one of the biggest supply shocks in decades and argued that measures taken so far have not been enough to durably reduce or stabilise prices for companies and citizens.

The six ministers called for an EU-level framework to tax windfall profits, saying a common approach is needed to ensure that companies benefiting from the crisis contribute to easing the burden on the wider population. They also asked for the results of a European investigation into refinery margins as soon as possible, to check whether refiners are benefiting from the rise in energy prices, Reuters reported.

In April, the European Commission approved a proposal by Portugal and several other countries for a windfall tax on energy companies, but said any decision would remain at national level. In Portugal, the government approved a temporary tax in late July on excess profits by oil companies this year, based on the share of profits above the average of the previous two years. The measure is due to be debated after parliament returns from its summer break.

Originally published at Eco.pt