Almost $6 billion. This is the net income obtained in the second quarter of 2022 by TotalEnergies, according to the announcement made by the group on Thursday July 28. A balance sheet that is more than twice as high as the gains in the second quarter of last year, which will shake people and may relaunch the debate on “superprofits”, against a backdrop of the war in Ukraine and an inflationary context.
First supported by Nupes and the National Rally (RN), the idea of a tax on “super profit” large groups found an echo on the part of the majority of the president and within Les Républicains (LR) party, but was rejected by several votes in the National Assembly on July 23, during the examination of the draft amendments that amend the financial law.
the @gobyernoFR rejected the extraordinary income taxation associated with the energy boom
Here are the results published by TotalEnergies
↗️ revenue of 18.7 billion at the end of June, ×3 compared to 06/21
Compared to the 500 million given for lowering the price of the pump pic.twitter.com/jTDM6kZkcH
— Valerie Rabault (@Valerie_Rabault) July 28, 2022
If, on the French side, the head of government Elisabeth Borne closed the door on Thursday on the tax on superprofits, abroad some countries are thinking about it. And some even took it. Franceinfo looks back at the way in which France’s neighboring countries have hijacked the debate.
In the United Kingdom, a tax on the profits of the oil giants
The UK’s Liberal parliament passed legislation at the end of May. To finance a plan of 15 billion pounds (about 17.5 billion euros) for the poorest households, the country decided to introduce a temporary tax of 25% on the income of oil and gas giants, like BP, after weeks of negotiations.
“As fuel prices return to historically low levels, leverage will be eliminated, with the introduction of a subsequent clause in the law”, explained Rishi Sunak, the Minister of Finance at the time, now in the running to replace Boris Johnson as Prime Minister. To encourage energy transfer, the measure in question also provides for tax reduction through a “High investment allocation of 80%” if targeted energy giants invest in low-carbon energies.
This temporary tax should make it possible to finance a third of the new social measures, bringing in almost 5 billion pounds in the next twelve months. Almost one in eight of the UK’s most vulnerable households will receive at least £1,200 by 2022, including a £650 living expenses allowance, the UK Treasury announced at the end of May.
In Spain, a tax on banks and electricity companies
The country plunged in mid-July, when the head of the Spanish government, Pedro Sanchez, announced that extraordinary taxes would be imposed on energy and financial companies in 2023 and 2024. This, to allow the population to cope with rising prices.
“This government will not allow companies that take advantage of the crisis to promote themselves.“, assured the Socialist Prime Minister of the Spanish Chamber of Deputies. The government hopes to reap nearly 7 billion euros between 2023 and 2024 thanks to these taxes, with profits estimated at nearly 2 billion euros per year for electricity companies and 1.5 billion for banks.
The announcement was made as part of a series of social measures taken to protect purchasing power against inflation, which exceeded 10% a year in June. Among these are fuel subsidies, reduced VAT on electricity and increased retirement pensions. Pedro Sanchez noticed at the beginning of July that “dSince the prices started to rise (…) Spain mobilized 30 billion euros” to support businesses and their consumers, “equivalent to 2.3% of its gross domestic product”.
In Italy, the focus is on large companies in the energy sector
For its part, Italy announced at the end of May its intention to raise the tax on super profits to 25%, which is equal to the rate implemented in the United Kingdom. At the end of March, the country decided to introduce a 10% tax on the income of large companies in the energy sector – such as Enel or Eni – thanks to the increase in prices due to the war in Ukraine. “We will redistribute this money to businesses and families who are in dire straits”declared the Italian Prime Minister at the time, Mario Draghi.
The government hopes to get 11 billion euros from this tax. But the estimate has been repeatedly challenged by companies, which say their profits may not be as high as oil and gas prices suggest. The money collected thanks to this new tax aims to finance a package of measures of 14 billion euros intended to alleviate the surge in energy prices for households and businesses. The envelope includes a particular bonus of 200 euros for 28 million Italians with an annual income of less than 35,000 euros.
Inflation stood at 8% in June every year, which is more than one point from the previous month, according to data provided by Istat (in English), the national statistics institute of Italy. This is the highest level reached since January 1986.
In Germany, an ongoing reflection on taxes on refineries
Economy Minister Robert Habeck, a member of the Greens and Germany’s vice-chancellor, came out in favor of a tax on refineries. He intends to present a text in the coming weeks, to attack the profits of large companies.
This solution was proposed by the German government to counter the failure of the fuel tax reduction. On June 1, Chancellor Olaf Scholz announced a unique fuel discount for three months, to reduce household bills in the face of rising energy prices. But the expected effect of this rebate on motorists did not happen. “Since the beginning of June, the price of gasoline at the pump has not stopped rising and found itself, for diesel like gasoline, about 2 euros per liter, that is to say the standard level before this measure”reminds franceinfo at the end of June. Inflation reached 7.5% for a year in July, ie 0.1% lower than the previous month.