European Central Bank official proposes taxing the rich and super-profits

The chief economist of the European Central Bank wants to prevent the public deficit from increasing. Financing aid to the most disadvantaged in the face of inflationPhilip Lane suggests instead taxing high income or corporate superprofits.

For both macroeconomic and equity reasons, as the energy shock hits people through record inflation, “governments should support the income and consumption of households and businesses that suffer the most,” said Philip Lane in a daily interview. Austrian The standard released on Tuesday. “The big question is whether some of this support should be funded by tax increases for the rich,” he continues.

These “very profitable” companies

His answer: “It could take the form of higher taxes on top earners or on industries and companies that are very profitable despite the energy shock,” such as Total that generated record profits, believes this influential member of the governing board of the monetary institute.

The ECB advocates state aid aimed at protecting households from the impact of inflation, as its president said again on Monday cristina lagarde prior to European Parliament. Similarly, “if you support the needy by raising taxes, this has less effect on inflation than if you increase deficits,” Philip Lane justifies.

Temporary and exceptional tax

The idea of ​​taxing the richest is already gaining ground within the eurozonewhere the Spanish government wants to introduce a temporary and exceptional tax for the richest 1% of the population, in order to finance the measures put in place to mitigate the impact of galloping inflation.

France has not gone that far: the finance bill for 2023 relies on the tariff shield to contain price increases. Divided on the question of a tax on “super profits”, the Government hopes to find a solution at scale European. Leaving the European Union, the United Kingdom announced last Friday a massive spending plan and tax cuts financed by the debt in the face of inflation at a level not seen in decades, which fueled the record fall in the pound.

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