# Exxon sues EU in move to block new windfall tax on oil companies
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2022-12-29
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Exxon Mobil sues EU over oil tax, risking investments
Meta Description: Exxon Mobil is challenging BRussels' windfall tax on oil groups, calling it "counter-productive" and discouraging investments in Europe's
URL: https://financedigest.com/exxon-sues-eu-in-move-to-block-new-windfall-tax-on-oil-companieshtml

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By Sabrina Valle

(Reuters) – U.S. oil major Exxon Mobil Corp is suing the European Union in a bid to force it to scrap the bloc’s new windfall [tax](https://www.financedigest.com/uk-oil-gas-firms-to-leave-years-worth-of-output-in-ground-with-tax-hikes-report.html "UK oil, gas firms to leave year’s worth of output in ground with tax hikes-report") on oil groups, arguing Brussels exceeded its legal authority by imposing the levy.

Record profits this year by [oil companies benefiting from high energy prices have boosted inflation](https://www.financedigest.com/oil-jumps-on-lower-than-expected-us-inflation-data.html "Oil jumps on lower-than-expected US inflation data") around the world and led to fresh calls to further tax the sector.

The windfall [profits tax is “counter-productive,” discourages investments and undermines investor](https://www.financedigest.com/aviva-boosts-investor-payouts-after-profit-beat.html "Aviva boosts investor payouts after profit beat") confidence, Exxon spokesperson Casey Norton said on Wednesday. Exxon will factor in the tax as it considers [future multibillion-euro investments](https://www.financedigest.com/investing-in-the-city-thats-investing-in-itself-welcome-to-the-liverpool-of-the-future.html "INVESTING IN THE CITY THAT’S INVESTING IN ITSELF – WELCOME TO THE LIVERPOOL OF THE FUTURE!  ") in Europe’s energy supply and transition, he said.

Whether we [invest here primarily depends on how attractive and globally](https://www.financedigest.com/volkswagen-to-invest-in-mines-in-bid-to-become-global-battery-supplier.html "Volkswagen to invest in mines in bid to become global battery supplier") competitive Europe will be,” Norton said.

GRAPHIC: Big [Oil’s big profit](https://www.financedigest.com/big-oil-doubles-profits-in-blockbuster-2022.html "Big Oil doubles profits in blockbuster 2022") (https://www.reuters.com/graphics/OILMAJORS-RESULTS/xmvjkgbzopr/chart.png)

The [Financial Times](https://www.financedigest.com/how-can-financial-services-companies-compete-more-effectively-in-times-of-uncertainty.html "How can Financial Services Companies compete more effectively in times of uncertainty?") first reported the lawsuit on Wednesday.

Windfall profit taxes imposed by Europe could [cost at least $2 billion](https://www.financedigest.com/australias-nuclear-submarine-plan-to-cost-up-to-245-billion-by-2055-defence-official.html "Australia’s nuclear submarine plan to cost up to 5 billion by 2055 -defence official") through the end of 2023, Chief Financial Officer Kathryn Mikells said in a call to analysts on Dec. 8.

Exxon said it [invested $3 billion in the past decade in refinery projects](https://www.financedigest.com/sse-to-invest-122-million-in-scottish-pumped-hydro-project.html "SSE to invest 2 million in Scottish pumped hydro project") in Europe. The projects are helping it deliver more [energy products at a time when Europe](https://www.financedigest.com/europes-energy-crisis-and-the-nuclear-path-out.html "Europe’s energy crisis and the nuclear path out") struggles to reduce its imports from Russia, the company said.

We will continue to [work with EU leaders to address these issues](https://www.financedigest.com/voice-quality-matters-quarter-of-employees-working-from-home-still-experiencing-regular-connectivity-issues.html "Voice Quality Matters: Quarter of Employees Working From Home Still Experiencing Regular Connectivity Issues"). Thoughtful policy is [critical,” the company](https://www.financedigest.com/mitigating-supply-chain-risks-five-critical-tips-financial-services-companies.html "Mitigating supply chain risks – five critical tips for financial services companies") said.

Chevron Corp had also warned that taxing oil production would serve only to reduce energy supply by discouraging [company investments](https://www.financedigest.com/anyone-can-write-assignment-need-people-able-apply-new-skills-workplace-says-top-investment-management-company.html "“Anyone can write an assignment, but we need people to be able to apply their new skills to the workplace,” says top investment management company").

That goes against the intent of increasing [suppliers and making energy](https://www.financedigest.com/french-energy-suppliers-will-let-struggling-bakers-renegotiate-contracts-le-maire.html "French energy suppliers will let struggling bakers renegotiate contracts – Le Maire") more affordable,” Chevron’s chief financial officer, Pierre Breber, told Reuters in October.

(Reporting by Sabrina Valle in Houston, Additional reporting by Arunima Kumar in Bengaluru; Editing by Chizu Nomiyama and Matthew Lewis)


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