Sánchez advocates for a special tax on energy companies that “profit from the war” at the EU summit

Eduardo González The Prime Minister, Pedro Sánchez, called during the informal European Union summit in Cyprus for the reinstatement of a “special tax” on “large energy companies” that “are profiting from the rise in oil prices” as a consequence of the war in the Middle East, “as we did during the Russian energy crisis.” Speaking to the media before the start of the second day of the informal summit, Sánchez noted that, as a result of the economic impact of the war launched by the United States and Israel against Iran, “the cost of importing fossil fuels in Europe has increased by 24 billion euros, that is, 500 million euros per day.” Therefore, he continued, during the first day of the summit he called on the Commission for “greater ambition in the European Union’s joint response” to “address this energy crisis and its impact on prices, particularly fuel prices.” To this end, he warned, it is necessary to wean Europe off fossil fuels and “gain energy independence” by investing “in the energy sources we have in our country,” specifically solar, hydroelectric, and wind power. Furthermore, he noted, “there are companies currently profiting from the rise in crude oil prices, and therefore we must take coordinated action to reinstate, as we did during the Russian energy crisis, a tax on large energy companies—a special tax to finance a significant portion of the measures we are currently taking to protect citizens, businesses, and industries.” The Prime Minister also warned of the need to seek “more resources to continue with the electrification and green energy transformation of our economies, including interconnections.” In this regard, he reported that he had proposed to the other 27 member states the possibility “of extending the Next Generation EU funds from six to twelve months, beyond June, to link them to the electrification of our economy, to link them to the energy transformation of the European economy and, therefore, of the Spanish economy.” Separately, Pedro Sánchez advocated for “opening the debate, as has been done with the defense budget, on a relaxation of fiscal rules to allow for investment in this energy transformation and electrification.” Middle East The Prime Minister reiterated “the crisis caused in the Middle East by this illegal war,” which demonstrates that “the law of the strongest, in the end, makes the world much weaker.” “That is what we are seeing, unfortunately, in the Middle East: a situation where the objective of the war is not exactly clear” and where “there also doesn’t seem to be enough trust between the parties to reach an agreement in the short term.” The result of all this is “suffering, the loss of thousands of lives as a consequence of the wars, hundreds of thousands of displaced people, for example, in Lebanon; an undermining of the international order and, finally, economic consequences that are already being paid for by households, businesses, industries—in short, European economies.” In this context, the Prime Minister reported that, just as Foreign Minister José Manuel Albares had done last Tuesday before his EU counterparts, he himself reiterated his support on the first day of the summit for the suspension of the association agreement between the European Union and Israel, “because something that is delegitimizing us, not only externally but also internally, within our societies, is this double standard, this double yardstick that Europe is using in Ukraine and the Middle East.” “It must be remembered that Article 2 of that association agreement between the European Union and Israel speaks of respecting international law, humanitarian law, and, clearly, neither in Lebanon, nor, of course, in the West Bank, nor, naturally, in Gaza, is Israel respecting it,” he asserted. “It cannot be that we are united, as we are, supporting, as we must, a people (the Ukrainian people) who are being subjected to an attempted invasion and a challenge to their territorial integrity, and yet we fail to do the same in the Middle East,” he warned. “Unfortunately,” he continued, “there are governments that are in favor, and other governments that are against.” “There is no unity on this issue, and all of this leads to a weakening of the European Union’s position, undermining our legitimacy, at least politically, and our credibility when it comes to defending causes as just as that of Ukraine,” he warned. “Europe is a project for peace, a multilateral project,” and therefore, “it is we who must defend this international order, this respect for international law,” because “if we do not, the law of the strongest, which is what we are witnessing, leads us to a weaker, much more insecure, and more uncertain world,” he stated. Regarding Ukraine, Pedro Sánchez celebrated that, “finally, after many months” and following the change of government in Hungary, “the aid of 90 billion euros to Ukrainian society has been unblocked, among other things, to support, not only from a military standpoint, but also from an institutional standpoint, a country that has been at war for more than four years.” Sánchez's proposals at the summit The informal summit addressed, as central issues, the Multiannual Financial Framework (MFF), the situation in Ukraine, and the response to the impact of the crisis in the Middle East. During the meeting, according to Moncloa, Sánchez reiterated the Spanish government's opposition to the war in the Middle East and advocated for a series of European measures to address the crisis stemming from this conflict. Among these, he highlighted the aforementioned tax on windfall profits in the energy sector to finance the measures proposed by the Commission to tackle the energy crisis. Sánchez also proposed the implementation of a new instrument, inspired by RePowerEU, to support green transition investments with the European budget. He also suggested extending NextGenerationEU funds for a period of six to twelve months to bolster anti-crisis investments for the electrification and energy transformation of European economies. In this regard, the Prime Minister stressed that Europe now has the opportunity to boost its strategic autonomy and accelerate electrification to avoid dependencies. He called on Member States to be ambitious with their upcoming budgets, in line with the Union's strategic priorities, such as competitiveness, innovation, the green and digital transitions, and security. On the political front, Pedro Sánchez advocated for a more active EU involvement in Lebanon and reaffirmed Spain's commitment to the stability of Syria. He also urged that attention not be diverted from the situation in Palestine and defended the adoption of effective measures regarding Israel, such as new sanctions or the suspension of the Association Agreement with the European Union. Regarding Ukraine, he welcomed the release of the €90 billion loan and emphasized the importance of the debate on Ukraine's accession to the European Union.

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