ExxonMobil files suit against EU over windfall tax: press
US major ExxonMobil has filed a lawsuit to block the EU’s new windfall tax on oil companies, the Financial Times reported December 28.
The suit, filed by ExxonMobil’s German and Dutch subsidiaries at the European General Court in Luxembourg City, claims the EU exceeded its legal authority in imposing the levy, which is designed to raise €25bn to help reduce energy bills in the EU.
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ExxonMobil said the Council of the EU used a legal authority normally reserved for sovereign countries and its use of emergency powers to secure approval of the tax from EU member states.
The tax – called a “solidarity contribution” in a broader package of measures imposed by the EU Commission in September – would take the form of an additional 33% tax rate levied by EU states on 2022 profits that are more than 20% higher than the average profit over the past three years.
In a November regulatory filing, ExxonMobil said its tax exposure under the windfall tax could amount to $2bn by the end of 2023. Since the EU imposed the levy, the UK and several EU states have imposed windfall profit taxes of their own, some of which are being challenged by producers.
In an email to the FT, ExxonMobil spokesman Casey Norton said the company was arguing the EU’s levy was “counterproductive” and would “undermine investor confidence, discourage investment and increase reliance on imported energy.”