Energy companies’ ‘grotesque greed’ is ‘damaging the poorest and destroying the planet’

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UN Secretary General’s support for a special tax is spreading across the political and activist fields

The special tax to tax the unexpected profits made by energy companies has many opponents who are making themselves heard on all fronts. Since Pedro Sánchez’s management announced it to raise 2,000 million euros a year, the affected companies and the majority of economic analysts have criticized it for several reasons: the former consider it unfair, as they assure that they have large amounts in Spain. sales despite record results in the first half of the year, and the oil companies point out that they already pay 5 points more in corporate taxes -such as banking-; the latter believe it is not very effective, predicting that its cost will somehow impact consumers’ bills, no matter how much the government looks for ways to ban it.

However, Spain is by no means the only country to apply such a tax. The United Kingdom or Italy tax these extraordinary gains with 25% – Rome has increased it from 10% this year – and even the United States is considering doing something similar. The president, Joe Biden, criticized the fact that energy companies “make more money than God” and asked Exxon to start investing and paying their taxes. “The oil companies have 9,000 licenses to extract oil, but they don’t do it because they make more without producing it and driving the price up,” he shot.

This Thursday, United Nations Secretary-General Antonio Guterres joined the equally large chorus of voices – especially from the political sphere – demanding these special taxes in a harsh speech. “Combined energy revenues in the first quarter are approaching $100 billion. I urge all governments to tax these excessive profits and use those funds to help the most vulnerable in these difficult times,” he demanded. Guterres pointed out that “many developing countries, drowning in debt and still struggling to recover from the Covid crisis, could be pushed to the brink” by the price escalation that started after the pandemic and increased by the war in Ukraine. The socio-political storm in Sri Lanka is a good example of this.

“It is immoral that the oil and gas companies that are making record profits from this energy crisis that is affecting the poorest people and communities and is a huge cost to the climate,” Guterres said at a press conference, denouncing the industry’s drive. by a “grotesque greed” that “harms the poorest while destroying our common home, the planet.”

Various organizations also see the unexpected profit tax as an initiative in the right direction. “There are strong arguments for it,” says the Tax Policy Institute, arguing that such taxes “do not cause disruption or change the behavior of companies.” Will Snell, director of the Fairness Foundation, also thinks it’s “effective and fair” and says the objections to it are never strong. Moreover, he recalls that, for example, the United Kingdom government has already applied them several times over the past century: «In the First World War, excess profits were taxed at 50% compared to the pre-war level. More recently, in 1981 Margaret Thatcher imposed a special tax on bank profits during the recession. Snell argues that the tax should be placed in the context of other measures aimed at creating a fairer tax system.

In Spain, the technicians at the Ministry of Finance (Guestha) also believe that taxes on profits that have fallen from the sky could benefit consumers if they are redistributed among them. In other words, they recommend a separate discount on the electricity bill that is proportional to your consumption. In this way, the extra benefits immediately fall back into a clear reduction in energy prices.

Source: La Verdad

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