Undeserved profits?

BP and Shell have both done well in terms of revenue and profits over the last three months. Already there are voices raised in disgust, and the early suggestions of the need to tax away those windfall profits.

(Strange isn't it, that H.M. Treasury has also done well, as at least 60% of the retail price is tax of one sort or another, and yet there are no voices raised in protest about that? It should also be pointed out that the retailer's profit margin is only one or two per cent.)

Observers have a very unbalanced view of profits. If an industry makes spectacular profits from forces outside its control, these are represented as so many million pounds per hour or day, or whatever. There is seldom a reference to how much capital is employed, or what future investment needs will be to maintain output. Nor is there any sympathy if the industry suffers falling profits and prices from forces outside their control. There is no suggestion that they should be compensated for their loss.

(Strangely, as well, this applies only to industry - pop stars and groups, high paid footballers, and others may enjoy vast sums from forces outside their control, but there is never any suggestion of windfall profits tax.)

Bottler will come under pressure to claw back some profit from oil and petrol by the retrospective taxation of the windfall profits. His Government has been gorged on it in the past and has overspent, and nobody would bet against BP and Shell being the latest victims if the high prices continue.

Despite his new refrain "taking decisions for the long-term", the need for income could become so large that he sacrifices the future for the present.