The Polish government is pressing ahead with plans to tax energy companies’ excess profits, widening its sights from fuel to gas. The potential windfall for the budget is huge, but defining where exceptional gain ends and ordinary profit begins has become the real obstacle.
State revenue estimates are the clearest reason for the push. Including gas suppliers in the levy would increase expected income from about PLN 4 billion to PLN 7-10 billion. The tax base would be far more concentrated than in fuel retail, because Orlen controls over 90% of Poland’s domestic natural gas market.
– In my opinion, the government is considering taxing gas suppliers because it would be simpler to implement than taxing fuel sellers. Some fuel companies have a dispersed structure, and importers operate on lower margins, which could create room to circumvent future regulations. In gas, the tax base would be much more concentrated – said Michał Kozak, an analyst at Trigon DM.
Fuel prices show how complicated a windfall tax can become. In roughly PLN 6 per litre of petrol, PLN 3.98 covers the refinery wholesale price, PLN 1.53 is excise, PLN 1.36 is VAT, and fuel charge, emission fee and station margin make up the rest. Dr Przemysław Zaleski of the Casimir Pulaski Foundation and Wrocław University of Technology calculated that in late July the station margin on Pb95 was only about PLN 0.13 per litre; on diesel it was even lower.
That small retail margin is not where the money is. The largest economic item is the cost of the fuel product itself, indirectly crude oil, international crack spreads and refining costs, followed later by taxes and the station margin. The refinery wholesale price is not simply an oil price; it contains the added value of processing, which is the refining and wholesale margin.
A thin line between normal and extraordinary profit
– At the refinery level, conditions are positive compared with a normal market, although not unprecedented – said Zaleski. Orlen’s model refining margin averaged USD 13.1 per barrel in 2025, USD 11 in 2024 and USD 17 in 2023, while in the crisis quarters of 2022 it reached USD 26.5-34.4 per barrel. The company’s long-term strategic assumptions for 2025-2030 counted on about USD 6.33 per barrel.
The integrated structure of Orlen makes things even harder. In the first quarter of 2026, the Upstream & Supply segment generated roughly PLN 5 billion EBITDA, Energy PLN 4.7 billion, Downstream PLN 3.1 billion and Consumers & Products PLN 1.7 billion. There is no single Orlen profit that can be pinned to petrol or gas.
– If the state simply added up high fuel, gas and other segment results and taxed them because the company earns a lot, it would in practice be a broad sector levy, not a classic windfall tax – said Zaleski.
– Fuels and gas are two different business models, based on a different structure of margins, different contract settlement cycle and different exposure to market risk – said Bartosz Kubista, managing partner at the GLC law firm and lecturer at the University of Silesia.
– Methodologically, two separate levies in one statute, with a separate reference benchmark for each sector, would be justified – added Kubista.
The fuel margin benchmark set on 2025 plus 20% cannot be transferred mechanically to gas, because gas trading results often depend on the spread between purchase and resale price, and transactions can be settled under multi-year contracts with indexation mechanisms. Kubista also questions what the correct taxable measure should be:
– I myself have a doubt whether the equivalent of the fuel margin should be sales margin, segment EBITDA or result per unit of sold volume. If we could not avoid this new tax, I lean toward the latter as closest to the logic of the gas industry – said Kubista.
Zaleski adds that gas is not just a business for Orlen but part of Poland’s energy security. The company invests in extraction, LNG, storage, infrastructure and long-term contracts.
– Taxing the normal return on these projects with an excess profit tax will reduce investment capacity much more than a temporary tax on a short-term jump in fuel margins – said Zaleski.
European precedents and the danger of a permanent levy
Poland is not starting from scratch. Europe already ran a large experiment with energy windfall taxes after Russia’s invasion of Ukraine, when oil, gas and energy prices soared. The EU mechanism covered crude oil, natural gas, coal and refining, and today individual countries are returning to the idea in different ways.
Portugal approved on July 30 a new 33% levy on windfall profits of oil and refining companies. Its reference point is average profit from the two previous years increased by 20%. Britain took a different route: its Energy Profits Levy applies to oil and gas extraction profits in the North Sea, an upstream activity, not fuel or gas sales.
The Polish fuel proposal is based on excess over reference margin from 2025 increased by 20%, with a 60% rate. Portugal’s version taxes the part of 2026 profit that exceeds by more than 20% the average profit from 2024-2025.
– The difference is methodologically significant, although at first glance it may seem small – said Kubista.
If the base is margin, the legislator captures economic surplus at a specific stage of the sales chain; if the base is profit, the company result becomes the point of reference. That decides the scale of the levy and also which companies and behaviours are covered.
– Most new levies were supposed to be temporary solutions, but in practice were extended year after year. Divergent implementations generated investment uncertainty without real closure of the fiscal objective. I am sceptical about the very idea of this levy because European experience shows a mechanism chronically badly tailored, prone to optimisation and difficult to extinguish despite its declared temporary nature – said Kubista.
The government has strong arguments for reaching for some part of the windfall: it needs extra revenue, and the public expects companies benefiting from exceptional market conditions to share some of the cost of the crisis. The real test of the levy will come not when it is passed but when the state has to prove it can be switched off. A good windfall tax should take what is genuinely exceptional and disappear when the exception disappears; otherwise a tax on extraordinary profit easily becomes an ordinary tax on profit.
Source: WNP.PL, Photo: Karol Serewis / Shutterstock
