(Vienna) The representatives of the Austrian financial sector have voted: "excess profits tax" (German: "Übergewinnsteuer") is the stock market taboo word of the year 2022. The term "excess profit" is used ambivalently: In accounting, it stands for exceeding the cost of capital; in the current media debate, there is often negative connotation of profit allegedly exceeding the norm. It is clear to the industry that a "standard profit" does not exist and that the discussion – up to and including state "profit skimming" – ultimately harms Austria as a business location. Related terms such as "windfall profits", "inflation" or "interest rate hike" were also nominated and thematically reflect the geopolitical changes and the resulting energy crisis.
"The term 'excess profits' has raised public calls for state intervention this year. However, Austria is already one of the leading countries in terms of height of tax collection and market interventions do not have a confidence-building effect. The focus should be on a European strengthening of innovation, as this is the key to maintaining prosperity and competitiveness. The capital market is available for financing innovation, as a tool to cushion inflation and to enable everyone to participate in growth – but it also needs to be used,” says Christoph Boschan, CEO of the Vienna Stock Exchange.
About the Austrian stock market taboo word
Since 2017, the Vienna Stock Exchange has annually asked the domestic financial community to nominate the stock market taboo word of the year. The jury's decision focuses on the topicality, relevance and linguistic significance of the words. This year's sixth stock market taboo word thus replaces last year's "specter of inflation" (stock market taboo word 2021). The financial community was right early on in a development that continued in 2022 with record inflation values. In the years before that, "corona-related" (2020), "Brexit" (2019), "punitive tariffs" (2018) and "negative interest rates" (2017) prevailed.
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Julia Resch
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