Left-wing parties want to retroactively tax Shell's record profits more heavily

The left-wing opposition parties in the Tweede Kamer want oil companies to pay more tax retroactively on the record profits they achieved last year thanks to the high energy prices. The proceeds should go to households that are in financial trouble due to the higher energy bills, according to GroenLinks, PvdA, SP, PvdD and Volt.

Shell reported a record profit of more than 38 billion euros on Thursday, a doubling compared to 2021. The British oil and gas giant is using the profit increase to channel more money to shareholders by increasing dividends and buying back its own shares.

The entire oil and gas industry benefited last year from the rise in prices caused by the war in Ukraine. ExxonMobil announced earlier this week that it earned a record amount of 52 billion euros last year. Together, the seven largest oil companies in the world made almost 260 billion euros in profit, according to the left-wing parties.

Fossil fuel producers already paid an additional tax of 33 percent last year on the extra money they earned due to the high energy prices. The left-wing opposition wants to raise that rate retroactively to 49.5 percent, equal to the top income tax rate. That would provide the treasury with an extra 1.7 billion euros.

"These absurd excess profits are simply inexplicable," said PvdA leader Attje Kuiken. Especially now that many people have difficulty making ends meet due to expensive groceries and high energy bills. Something can be done about this "if large energy companies with substantial excess profits make an honest contribution," she said.

GroenLinks leader Jesse Klaver claimed that "hundreds of thousands of families" are in trouble due to the sky-high inflation. "And oil companies are making record profits for a handful of shareholders. It's time to fairly tax the exorbitant excess profits of these companies, and we can arrange that today."

Energy Minister Rob Jetten (D66) said that he shares the outrage expressed by the MPs. "You're really taken aback when you hear those billions in profits." But he also said that there is little he can do about it, because it concerns companies that are either not based in the Netherlands, or no longer based in the country. He said there is "very little" the Cabinet can do, if anything, to attempt to tax the extra billions in profits.

Jetten acknowledged that it would be possible to more heavily tax the part of Shell's excess profits earned in the Netherlands. But he warned that the desired extra gas production in the North Sea, "which we simply really need to prepare for the coming winter," could then be jeopardized.