France Mulls Extending Windfall Tax on Oil and Power GiantsÂ
France is considering an extension of its windfall tax for oil and power companies into the New Year, according to French lawmaker Jean-Rene Cazeneuve, who shared the plan on X.
The plan, hatched by the National Assembly’s finance committee, is part of a proposed amendment to France’s budget bill for 2024 and would serve to offset higher costs for French consumers of gasoline, diesel, and electricity.
The budget bill still must be adopted by parliament to go into effect.
Last November, when the original windfall tax plan was being crafted, it was said that utility EDF would cost the company more than $5 billion across 2023.
In September last year, the Council of the European Union agreed to impose a temporary windfall tax on energy companies that realize “above a 20% increase of the average yearly taxable profits since 2018,” on top of whatever taxes these companies already pay in their individual countries.
ExxonMobil filed a lawsuit against the EU over a 33% windfall tax it was slapped with last December, claiming that it would likely cost the company $2 billion.
French Finance Minister Bruno Le Maire said last month that windfall taxes could help alleviate the pain of high consumer prices, and raised questions about how much profits oil refiners were bringing in.
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Last year at this time, France was in the middle of an oil refining crisis as refinery workers went on strike, demanding a larger chunk of refining profits from companies including TotalEnergies and ExxonMobil.
In June, TotalEnergies reported that its average margin on oil refining more than halved in Q2 to $42.7 per tonne compared to Q1, and was down two-thirds from the same quarter last year. Total said European refining had been hit by higher Chinese exports and Russia’s ability to find new outlets for its oil products.
