Germany wants to ensure that only companies that need financial help, in the context of the effects of the war in Ukraine, will be able to benefit from the subsidy collected from the new gas tax, a government spokesman announced on Friday, Reuters reports.

The Ministry of Economy is looking to modify the tax, the German official said.

Households in Germany will have to pay almost 500 million euros more a year for gas after the introduction of a new tax designed to help utilities cover the cost of replacing Russian supplies.

Trading Hub Europe, Germany’s gas market operator, announced this month that it had set the tax level at 2.419 eurocents/kWh.

The tax will be imposed from October 1 and will remain in force until April 2024, in an attempt to help Uniper (the country’s largest importer of Russian gas) and other importers to cope with rising prices, according to Agerpres.

For an ordinary family of four, the tax will mean an additional annual cost of approximately 480 euros.

“The alternative would have been the collapse of the energy market in Germany and a large part of the European energy market,” said the Minister of Economy, Robert Habeck, referring to the new tax.

The industry will be hit by the new tax, with the German Steel Federation estimating it will add around 500 million euro a year to the sector’s energy bill, on top of the 7 billion extra costs already caused by higher energy prices.

Economists have warned that the tax will accelerate inflation in Europe’s biggest economy, which has already reached a high of 8.5%.

Germany has tried to avoid the situation where consumers are the ones paying for the increase in energy costs. But the pressures facing utilities have forced the government in Berlin to change its approach in trying to reduce consumption and prepare for the winter season, amid concerns that Russian President Vladimir Putin would could completely stop gas supplies.