Windfall taxes on energy companies are a bad idea
Governments should not seize the energy industry’s profits
![](https://www.economist.com/cdn-cgi/image/width=1424,quality=80,format=auto/sites/default/files/images/2022/03/articles/main/20220319_ldd004.jpg)
WHENEVER OIL and gas are expensive, politicians’ eyes turn greedily to the profits of energy firms. Since energy prices began to surge last year Bulgaria, Italy, Romania and Spain have introduced new taxes on the industry. On March 8th the European Commission recommended that governments try to “capture a part of the returns” made by electricity generators. And in America 12 Democratic senators including Elizabeth Warren, a one-time presidential candidate, have proposed a tax on every barrel of oil big firms produce or import, equal to half the difference between the current oil price and the 2015-19 average.
This article appeared in the Leaders section of the print edition under the headline “Tilting at windfalls”
More from Leaders
![](https://www.economist.com/cdn-cgi/image/width=1424,quality=80,format=auto/media-assets/image/20240817_LDD010.jpg)
America is sabotaging itself in the global battle for talent
Some countries are much more serious about attracting the highly skilled
![](https://www.economist.com/cdn-cgi/image/width=1424,quality=80,format=auto/media-assets/image/20240817_LDD004.jpg)
Time to shine a light on the shadowy carry trade
Transparency will help to avoid financial blow-ups
![](https://www.economist.com/cdn-cgi/image/width=1424,quality=80,format=auto/media-assets/image/20240817_LDD020.jpg)
Reluctantly, America eyes building more nuclear weapons
The superpower faces more adversaries, new technologies and less-confident allies
Our forecast puts Kamala Harris and Donald Trump neck and neck
We relaunch our presidential-election model for a transformed race
The rights, wrongs and risks of Ukraine’s Kursk incursion
Ukrainian forces should be careful not to overreach
Why Ethiopia and Nigeria must press on with reforms
Currency liberalisation alone is not enough