Finance and economy ministers from Italy, Germany, Spain, Portugal and Austria have asked the European Union to introduce a windfall tax on energy companies’ excess profits, as fuel prices rise sharply.
In a joint letter to EU Climate Commissioner Wopke Hoekstra, the ministers said energy firms should contribute to easing the financial pressure on households and public budgets. They pointed out that rising fuel prices, linked to the Middle East conflict, have boosted company profits while consumers face higher costs.
Coordinated EU action proposed
The ministers stressed that national measures, such as adjusting excise duties, should be supported by a coordinated EU response. They argued that a shared approach could fund temporary consumer relief, reduce inflation, and avoid extra strain on government finances.
They suggested reviving a mechanism similar to the EU’s 2022 “solidarity contribution”, which taxed around €28 billion of excess fossil fuel profits during the post-Ukraine war price surge. This time, they propose applying the scheme across the EU, strengthening its legal basis, and targeting large multinational energy firms, including profits earned outside the EU.
Rising fuel prices drive urgency
Global oil prices have climbed sharply, with Brent crude oil reaching around $100 per barrel, up from roughly $70 before recent military developments involving the United States, Israel, and Iran. Disruptions to supply routes, including the closure of the Strait of Hormuz, have increased market instability and contributed to higher fuel costs across Europe.
Countries such as Germany, Italy and Spain have been among the hardest hit by the surge. Hans Stegemen, chief economist at Triodos Bank, described windfall taxes as a logical measure, noting that fiscal policy should redistribute gains when crises generate unexpected profits for energy companies.
The European Commission has previously rejected suspending the EU’s fiscal rules under the Stability and Growth Pact, which would have given governments more flexibility to address the crisis.
