UN Chief Calls for Taxing Windfall Profits of Energy Companies

On Wednesday, United Nations Secretary Antonio Guterres called for taxation on windfall profits of oil and gas companies to ease the impact of the energy crisis on the most vulnerable people.

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"It is immoral for oil and gas companies to be making record profits from this energy crisis on the backs of the poorest people and communities and at a massive cost to the climate," he said at the launch of the third report of the Global Crisis Response Group on Food, Energy and Finance over the Ukraine conflict.

Guterres also noted that combined profits of the largest energy companies in the first quarter of this year are close to US$100 billion.

"I urge all governments to tax these excessive profits and use the funds to support the most vulnerable people through these difficult times," he said. "And I urge people everywhere to send a clear message to the fossil fuel industry and their financiers that this grotesque greed is punishing the poorest and most vulnerable people, while destroying our only common home, the planet."

All countries, and especially developed countries, must manage energy demand. Conserving energy, promoting public transport and nature-based solutions are essential components of that, the UN Secretary said.

There is also a need to accelerate the transition to renewables, which in most cases are cheaper than fossil fuels. At the same time, private and multilateral finance for the green energy transition must be scaled up, Guterres said, adding that every country is part of this energy crisis, and all countries are paying attention to what others are doing. "There is no place for hypocrisy."

Developing countries don't lack reasons to invest in renewables. Many of them are living with the severe impacts of the climate crisis. What they lack are concrete, workable options. Meanwhile, developed countries are urging them to invest in renewables, without providing enough social, technical or financial support.

Some of those same developed countries are introducing universal subsidies at gas stations, while others are reopening coal plants. It is difficult to justify such steps even on a temporary basis, the UN Secretary said.

"If they are pursued, such policies must be strictly time-bound and targeted, to ease the burden on the energy-poor and the most vulnerable, during the fastest possible transition to renewables."