Politics
Windfall Tax calls as Reform pumps out nonsense on oil prices
350.org today called on G7 countries to enact a Windfall Tax or tax on the excess profits of oil and gas companies benefiting from price surges following the Iran war. The group made the demand after G7 finance ministers said it was studying “necessary measures” to address the war’s economic impacts, including the release of emergency oil reserves.
The Windfall Tax
In 2022, the UK government imposed a 25% levy on major fossil fuel companies to help ease the prices of oil and gas following a surge driven by the Ukraine war, raising £3.6bn in two years.
Such revenues from a Windfall Tax can be used as an immediate buffer to protect families from price surges, as well as fund long-term, homegrown renewable energy solutions.
Fanny Petitbon, 350.org France country manager, said:
Releasing emergency oil reserves is just a sticking plaster on a gaping wound. If G7 countries are serious about stabilising the market, they need to stop protecting profits and start taxing companies which fuel the climate crisis.
Working people shouldn’t be paying the price while oil majors treat the war in the Middle East like a winning lottery ticket. We need the G7 to step up and establish a windfall tax now to put those profits back into the pockets of the people.
The French government, as president of the G7, must also confront the elephant in the room – the urgent phase-out of fossil fuels. It can no longer look away from the reality which is that we cannot stay addicted to oil and gas.
Clémence Dubois, 350.org global campaigns manager, said:
Wars expose a deep flaw in our energy system: when prices spike, fossil fuel companies stand ready to cash in while households and businesses struggle. That’s not just market volatility, it’s the result of governments allowing fossil fuel companies to keep the power to shape the energy system and pass the costs onto everyone else.
G7 governments must stop reinforcing this model with fossil fuel tax cuts that only inflate corporate earnings. Cutting fossil fuel taxes during a crisis is not a relief for families, it’s a subsidy for companies that are already enjoying windfall profits.
The right response is a strong windfall tax, which should be redirected to support households and accelerate the transition to clean energy that reduces our dependence on the very fuels driving both climate disruption and global instability.
Masayoshi Iyoda, 350.org Japan campaigner said:
Most of Japan’s oil imports pass through the Strait of Hormuz, making Japan acutely exposed to fossil fuel price shocks. Prime minister Sanae Takaichi has moved to calm fears over rising energy and food prices, but reassurances and stop-gap measures like releasing oil reserves are not enough.
Fossil fuel companies are cashing in on this crisis. A windfall tax on polluting industries would make them pay by taking responsibility, not ordinary families already stretched by years of stagnant wages and price surges due to climate impacts.
When PM Takaichi meets US president Trump next week, we urge her to reconsider Japan’s alignment with the Trump administration’s fossil fuel agenda. The attack on Iran has shown, once again, how that agenda means prosperity for oil and gas corporations, and higher bills for everyone else.
Accelerating a just transition to renewable energy and phasing out fossil fuels is Japan’s best option to secure affordable and sustainable energy based on democracy and peace.
Meanwhile, Reform…
Meanwhile, the leadership of Reform staged a petrol station stunt promising cheaper fuel and energy bills. Avoiding warzones like Dubai or London, the party found a filling station in rural Derbyshire.
Like many such isolated stations, its prices are significantly higher than elsewhere. Reform’s answer to this was to subsidise the price for one day. Supposedly this indicates lower prices should the party make it into government.
They’d do this by attacking what they call “green levies”. These fund long-term heating and energy efficiency programmes. In other words, measures that can reduce household bills and make people in the UK less vulnerable to global price shocks.
As global gas prices surge following the conflict with Iran, what the stunt actually highlights is the UK’s continued dependence on oil and gas. This leaves households at the mercy of international wholesale markets.
A spokesperson for the End Fuel Poverty Coalition, which campaigns to lower home energy costs, said:
Scrapping support for heat pumps and energy efficiency programmes would lock the country into a continued cycle of high energy prices and fuel poverty.
The reason households are facing rising costs today is because the country remains heavily dependent on oil and gas whose prices are set on volatile global markets.
As the conflict in the Middle East shows, when tensions rise anywhere in the world the price of gas quickly follows. That is what pushes up energy bills, not investment in cleaner heating.
The real way to cut bills for working people is to reduce the amount of gas we burn through better insulated homes, expand homegrown renewable power and reform energy pricing so households are no longer exposed to constant gas price shocks.
Robert Palmer, deputy director of campaign group Uplift, added:
It’s clear that the only route to lower bills and secure energy is to free ourselves from oil and gas through homegrown renewable energy and upgrading homes, whether that’s with solar panels or heat pumps. This is just common sense in today’s world
New North Sea drilling will make no difference to UK energy bills and have no meaningful impact on the UK’s supply of gas.
As the Canary reported on 9 March, the Windfall Tax enjoys wide popularity in the UK. Polling in Scotland, before the attack on Iran, showed supporters of all political parties supported the measure.
Hitting the fossil fuel profiteers in the pocket can stabilise prices for consumers and hasten the move towards sustainable alternatives. A fatuous gimmick from the snake oil salesmen of Reform achieves nothing.
Featured image via the Canary