icon bookmark-bicon bookmarkicon cameraicon checkicon chevron downicon chevron lefticon chevron righticon chevron upicon closeicon v-compressicon downloadicon editicon v-expandicon fbicon fileicon filtericon flag ruicon full chevron downicon full chevron lefticon full chevron righticon full chevron upicon gpicon insicon mailicon moveicon-musicicon mutedicon nomutedicon okicon v-pauseicon v-playicon searchicon shareicon sign inicon sign upicon stepbackicon stepforicon swipe downicon tagicon tagsicon tgicon trashicon twicon vkicon yticon wticon fm
29 Dec, 2022 09:30

US oil major sues EU over windfall tax

Exxon Mobil says the levy on excessive profits would not help lower bills for consumers
US oil major sues EU over windfall tax

US energy giant Exxon Mobil on Wednesday filed a lawsuit against the European Union, aiming to block the recently announced windfall tax on oil companies.

The suit was filed by Exxon’s Dutch and German subsidiaries at the EU’s General Court in Luxembourg. It contests the legal authority of the EU Council to impose the levy, arguing that it should be a matter decided by each country individually.

Brussels introduced the new tax in September as part of a package of measures aiming to curb the surge in energy prices. The price spikes have helped oil and gas companies bring in record profits in recent months, but also caused a surge in energy bills for consumers and businesses.

The tax, due to take effect from December 31, will be 33% on any taxable profits of oil companies in 2022-23 that are 20% or more above their average profits between 2018 and 2021. It is expected to raise €25 billion ($26.5 billion) in revenue for the bloc.

Exxon, one of EU’s largest oil suppliers and a major investor in European refining, has acknowledged that high energy prices are “weighing heavily on families and businesses,” but argues that the tax will be counterproductive and is unlikely to help the bloc lower bills. Exxon spokesperson Casey Norton said it would, however, “undermine investor confidence, discourage investment, and increase reliance on imported energy and fuel products.

The European General Court is now set to decide whether to rule on Exxon’s lawsuit, with analysts saying the proceedings could last throughout much of the next year.

For more stories on economy & finance visit RT's business section