EU finance ministers are divided over a joint windfall tax on energy companies benefiting from higher oil and gas prices, as member states weigh measures to ease rising living and fuel costs across Europe.
European Union finance ministers met in Dublin on 18 September 2026 to discuss imposing a joint windfall tax on energy companies. The debate centres on profits these firms are making from surging oil and gas prices following the closure of the Strait of Hormuz.
What triggered the discussion
Oil futures climbed past USD 100 per barrel, roughly 50% higher than prices before the Iran conflict. The supply shock has driven up consumer costs across Europe, triggering concern from six major member states.
In late August, finance ministers from Germany, Spain, Portugal, Italy, Poland and Austria issued a joint warning about the crisis, citing voter anger over rising living expenses.
The timing matters. France, Italy, Spain, Poland, Greece, Finland, Slovakia and Estonia all face parliamentary elections in 2027.
Germany’s position
German Finance Minister Lars Klingbeil directly challenged the European Commission to draft a proposal by October’s next meeting. Klingbeil argued that oil companies were exploiting the supply crisis and inflating their profits unfairly. He demanded the Commission present concrete models for an EU-wide tax mechanism immediately.
The Commission’s response
Valdis Dombrovskis, the EU’s Economic Commissioner, took a different stance. He stated the Commission has no current plans for a unified EU tax proposal. Instead, Dombrovskis emphasised that individual member states retain control over taxation decisions and remain free to implement windfall taxes on their own.
The disagreement sets up October talks as a critical moment for resolving how Europe will respond to energy company profits during the current supply crisis.
Taxes drive steep diesel price gaps across Europe
Diesel prices across the European Union vary dramatically, driven primarily by national tax policies rather than crude oil costs alone.
On 14 September, Malta recorded the lowest pump price at EUR 1.20 per litre, while Finland, Denmark and the Netherlands charged among the world’s highest fuel taxes, pushing retail prices significantly upward.
The tax impact is substantial. Finland’s diesel cost EUR 1.48 per litre before taxes but EUR 2.50 after. Denmark mirrored this at EUR 1.43 pre-tax and EUR 2.50 post-tax. The Netherlands charged EUR 1.50 before taxes and EUR 2.49 after. France, meanwhile, saw pump prices reach EUR 2.29 on 14 September, compared to EUR 1.30 before taxes.
Eastern European countries like Bulgaria and Poland maintain lower excise duties, keeping their fuel prices down. France chose a different approach, offering targeted support to sectors most exposed to rising energy costs through 31 December rather than cutting fuel taxes.
