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Germany plans to slap energy companies with more taxes – Reuters – RT Business News

The levy would apply to profits that are 20% above the average of the previous three years

The German government plans to introduce a special levy to take 33% of extra profits made by companies during the current energy crisis, Reuters reported on Wednesday, citing finance ministry sources.

The tax, called the EU’s contribution to the energy crisis, would be implemented by the end of the year. This would affect oil, coal and gas companies and refineries whose profits for this year and next exceed 20% or more of their 2018-2021 average.

According to the report, the tax could generate revenues of between 1 and 3 billion euros.

According to the sources, Berlin is in talks on the tax at the European Union level and has considered several ways to implement it.

“This requirement of European law leads us to a thin layer of ice in German tax law, but it must be implemented”, Finance Minister Christian Linder told a conference, adding “At the Ministry of Finance, we are making a suggestion to Parliament on how to proceed in the most responsible way in terms of the constitution.”

Tax law experts told Reuters the tax could be challenged legally as a violation of the general principle of equality through unjustified unequal treatment of businesses.

However, according to two reports by the scientific service of the Bundestag, quoted by Reuters, an exceptional tax is legally possible in Germany.

On Tuesday, Germany announced another levy that would apply to windfall electricity profits from September 1, 2022 and last until at least June 2023.

German traditional and renewable energy lobbies reportedly criticized both levies as too bureaucratic and difficult to achieve.

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