German Chancellor Olaf Scholz announced on Sunday that his government intends to use windfall profits from energy companies to lower consumers’ energy bills.
Olaf Scholz spoke at the press conference presenting a new (third) package to help families and businesses cope with rising costs of living and energy, raising the overall value of support measures in Germany up to 65,000 million euros.
In the document that advances a new plan for massive aid against inflation, the German government indicates that it will defend a measure of “partial deduction of extraordinary profits” so that these companies can establish themselves within the European Union, but affirms that it is ready to perform at the national level.
“Producers are simply taking advantage of sky-high gas prices that drive up electricity prices,” the German chancellor said at the press conference, referring to what is commonly known as ‘windfall profits’.
The solution sought by Berlin differs, however, from the taxation of exceptional profits of energy groups decided by some European governments, according to Finance Minister Christian Lindner, also leader of the Liberals, one of the parties that make up the Germany government, in this joint press conference.
The government discussed this “controversial idea,” said the official, who added, however, that “there are constitutional doubts about it,” said the official, who opposes the principle of a tax on “extraordinary profits.”
According to the minister, quoted by AFP, it is not “a source of income that can be planned and that allows rapid relief” of internal accounts.
Although the word tax is not used, it could be a compulsory contribution imposed on companies in the energy sector to reduce the price of electricity paid by families and companies.
This mandatory contribution, underlined the Finance Minister, could “provide several tens of billions of euros”.
Germany, along with the rest of the countries of the European Union, is facing a sharp rise in electricity prices, in addition to fears about energy supply due to the cut off of Russian gas, on which German industry is highly dependent.
Even so, and despite the paralysis of the gas supply through the Nord Stream 1 gas pipeline, Foreign Minister Olaf Scholz assured today that Germany “will be able to face this winter” and guarantee the energy supply.
* News updated at 12:25 pm.
Source: TSF
