Exxon Mobil has sued EU.

The suit threatens the viability of a levy that the European Commission said would raise €25bn «to help bring down energy bills». Exxon’s German and Dutch units filed the lawsuit yesterday at the European General Court in Luxembourg. Exxon had spent $3bn on European refining projects in the past ten years, increasing output «at a time when Europe struggles to reduce its energy imports from Russia», Norton said. Norton added that Exxon was now weighing «future multibillion-euro investments» in the continent.

Exxon was not opposing those, Norton said. However, if the European General Court decides to rule on Exxon’s suit, any judgment would be subject to appeal at the European Court of Justice, meaning proceedings will likely stretch through much of next year. The tax takes effect from December 31, with a levy of at least 33 per cent on any taxable profits in 2022-23 that are 20 per cent or more above average earnings from 2018-2021. Exxon, one of the largest petroleum suppliers in Europe, said in November that its liability under the levy could amount to $2bn by the end of 2023.

The company generated record global profits of almost $20bn in the third quarter. Soaring oil company profits have provoked anger as surging fuel prices fan rampant inflation and threaten to tip economies into recession. The EU’s levy was echoed in November by the UK, which increased its windfall tax on oil and gas producers from 25 per cent to 35 per cent and extended it until 2028. Agathe Bounfour, oil lead at the NGO Transport & Environment, said Exxon’s suit was «an attempt at intimidation».

www.sba.tax

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