AP

Germans face higher bills as tax aids natural gas importers

Aug 15, 2022, 5:14 AM | Updated: 12:00 pm

BERLIN (AP) — Germans are facing a new tax on natural gas use that could cost the average household several hundred euros a year and is aimed at rescuing importers slammed by Russian cutbacks tied to the war in Ukraine.

An association of gas pipeline operators on Monday set the level at 2.4 euro cents per kilowatt hour under legislation passed by the German parliament, which had an expected range of 1 to 5 cents. The tax on gas that is used to heat homes in winter and generate electricity is set to take effect in October and run through the beginning of April. It will not show up in utility bills until November or December.

Vice Chancellor Robert Habeck has said the tax will mean added costs of several hundred euros per year for an average household. The government is seeking ways to soften the blow through financial assistance for poorer households and a proposed break on value-added tax. Chancellor Olaf Scholz tweeted Monday that “we will leave no one behind” amid the higher costs.

The gas tax will raise money to compensate importers of Russian gas whose contracts with city utilities do not permit them to pass on the costs of surging natural gas prices. Russia has sharply cut back supplies of natural gas that costs less under long-term contracts, forcing importers to purchase much more expensive gas on the spot market to fulfill their obligations.

The government has agreed to bail out the largest importer, Uniper. Habeck said that 12 importers have applied for help and would receive 34 billion euros ($34.7 billion), or about 90% of their exceptional costs, the dpa news agency reported.

He said Monday that the choice was not between a tax and no tax: “The alternative would have been the collapse of the German energy market.”

Energy-intensive businesses urged the government to limit the burdens from the new tax. Steel producers said it would cost them 500 million euros annually, while the VDMA association of mechanical engineering firms — a pillar of Germany’s export-oriented economy — warned that the tax was “a significant burden” on top of soaring natural gas prices.

Russia’s state-owned gas exporter Gazprom has dialed back shipments to Europe, leading to charges the Kremlin is using the resulting gas shortage to drive up prices and pressure European Union governments over their support for Ukraine and over sanctions against Russia following the invasion.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

Ray Epps Ray Epps, an Arizona man who became the center of a conspiracy theory about Jan. 6, 2021, ...

Associated Press

Ray Epps, an Arizona man who supported Trump, pleads guilty to Capital riot charge

Ray Epps, the target of a conspiracy theory about the Jan. 6, 2021, attack, pleaded guilty on Wednesday to a misdemeanor charge.

8 hours ago

Former President Donald Trump repeatedly declined in an interview aired Sunday, Sept. 17, 2023, to ...

Associated Press

Trump refuses to say in a TV interview how he watched the Jan. 6 attack unfold at the US Capitol

Former President Donald Trump repeatedly declined in an interview aired Sunday to answer questions about whether he watched the Capitol riot.

4 days ago

This frame grab from video, provided by the Mexican government, shows Ovidio Guzman Lopez being det...

Associated Press

Mexico extradites son of ‘El Chapo,’ Ovidio Guzman Lopez to US

The son of notorious cartel leader Joaquin “El Chapo” Guzmán, Ovidio Guzman Lopez was extradited to the U.S. on Friday.

4 days ago

impeachments in US history...

Associated Press

A look at notable impeachments in US history, including Texas Attorney General Ken Paxton

Texas Attorney General Ken Paxton was acquitted Saturday on during his impeachment trial. Here's a roundup of impeachments in U.S. history.

4 days ago

The sticker price is displayed in the window of an unsold 2023 Navigator sports-utility vehicle at ...

Associated Press

The auto workers strike will drive up car prices, but not right away — unless consumers panic

Car shoppers are heading for a new round of sticker shock if the strike by the United Auto Workers doesn’t end soon, officials say.

5 days ago

Gov. Michelle Lujan Grisham announces an order restricting people from carrying guns in Bernalillo ...

Associated Press

Group sues after New Mexico governor suspends right to carry guns in Albuquerque in public

The New Mexico governor's emergency order suspending the right to carry firearms in public near Albuquerque drew an immediate court challenge.

11 days ago

Sponsored Articles

Home moving relocation in Arizona 2023...

BMS Moving

Tips for making your move in Arizona easier

If you're moving to a new home in Arizona, use this to-do list to alleviate some stress and ensure a smoother transition to your new home.

...

Mayo Clinic

Game on! Expert sports physicals focused on you

With tryouts quickly approaching, now is the time for parents to schedule physicals for their student-athlete. The Arizona Interscholastic Association requires that all student-athletes must have a physical exam completed before participating in team practices or competition.

...

Ability360

At Ability360, every day is Independence Day

With 100 different programs and services, more than 1,500 non-medically based home care staff, a world-renowned Sports & Fitness Center and over 15,000 people with disabilities served annually, across all ages and demographics, Ability360 is a nationwide leader in the disability community.

Germans face higher bills as tax aids natural gas importers