Taxing oil superprofits: Germany targets TotalEnergies via Brussels

Germany is leading a coalition of six European nations to impose a tax on oil superprofits. In their sights is the French giant TotalEnergies, which could face a bill of up to 1 billion euros. This marks another point of friction between France and Germany—following tensions over nuclear, space, and defense sectors—further straining an already tense economic climate for Paris. The article Taxing oil superprofits: Germany targets TotalEnergies via Brussels appeared first on Cryptoast.

A coalition of six EU member states, led by Berlin, is pushing to implement a windfall tax on the super-profits of oil and gas giants. This initiative, which will take center stage at the upcoming summit of finance ministers in Dublin, aims to capture the excessive gains driven by global market volatility and logistical disruptions, particularly in the Middle East. Proponents argue that these margins, which far exceed the natural rise in crude oil prices, justify a greater contribution from major energy firms to European solidarity.

At the heart of this push is TotalEnergies, whose recent financial performance has made it a primary target. The French group, which reported a 73% increase in global net profit over the past year, could be forced to pay between €500 million and €1 billion, depending on the rates considered by Brussels. In response, the leadership of the French flagship has already threatened to scrap its fuel price-capping mechanisms at its service stations, highlighting the risk of a double taxation that could undermine its investment strategy.

The debate raises a major legal question: the European Union's actual capacity to legislate on fiscal matters, which in principle require unanimity among member states. To bypass this deadlock, the coalition might attempt to invoke Article 122 of the Treaty on the Functioning of the EU, a tool used to decree emergency measures in the event of a severe economic crisis. Although this path was utilized in 2022, it remains a volatile and contested route, with the Commission having rejected a similar request last spring due to institutional caution.

This latest friction further weakens a Franco-German alliance already strained by deep disagreements over defense, space, and nuclear energy policies. For France, the taxation of its national champion would come at a critical juncture, as public finances face pressure from rising borrowing costs and jittery rating agencies. The outcome of the September summit will therefore be decisive, not only for the balance sheets of European majors like ENI or Repsol, but also for the cohesion of a European Union increasingly divided over its fiscal and economic sovereignty.