Germany weighs windfall tax as fuel prices climb

Germany’s Vice Chancellor and Finance Minister Lars Klingbeil has urged his Christian Democrat coalition partners to pursue further steps to tackle rising fuel prices, including the possible introduction of a windfall tax on energy companies.

In a letter addressed to CDU leader and Chancellor Friedrich Merz and Economy Minister Katherina Reiche, Klingbeil warned that additional measures may be necessary “at an early stage” to curb inflationary pressures, Caliber.Az reports via foreign media.

Among the proposals under consideration are a tax on excess profits, designed to limit gains made by companies benefiting from the crisis, as well as a more flexible fuel price cap and increased tax relief for commuters who travel by car.

The appeal comes as Germany implements new rules limiting petrol stations to raising prices only once per day, at midday. Operators who fail to comply face fines of up to €100,000.

Despite the measures, fuel prices continued to climb on April 2. According to figures from ADAC, the price of E10 petrol rose to €2.198 per litre, up by around nine cents compared with before noon, while diesel increased by approximately 11 cents to €2.415 per litre. These figures represent peak values rather than daily averages.

Rising prices have also had cross-border effects. In recent days, long queues have formed at petrol stations in several Polish towns near the German border, as motorists travel abroad to refuel at lower prices. German media reports suggest that so-called “fuel tourism” is becoming increasingly widespread as a result of the price gap.

By Aghakazim Guliyev