economy
European ministers call for a tax on energy company windfall profits as Iran war drives price surge
Driven largely by higher oil prices, the annual inflation rate in the 21 countries that use the euro rose to 2.5% in March, from 1.9% in February.
TL;DR
- Spain, Germany, Italy, Portugal, and Austria are urging the EU to impose a windfall tax on energy companies.
- The proposed tax is a response to surging oil and gas prices driven by the war in Iran, which are fueling inflation.
- Ministers cited "market distortions" and the need for a fair distribution of the economic burden on citizens.
- The EU is vulnerable to external shocks due to its dependence on imported oil and gas.
- A similar EU "solidarity contribution" was imposed in 2022 following Russia's invasion of Ukraine.
- Annual inflation in the Eurozone rose to 2.5% in March, largely due to higher oil prices.
- Iran's blocking of tanker traffic through the Strait of Hormuz threatens to stress fuel markets.
- EU Energy Commissioner Dan Jorgensen warned that fuel prices are unlikely to return to normal soon.