Jump in UK windfall profit tax on energy companies approved

Robert Besser
20 Nov 2022, 20:07 GMT+10

UK's finance minister, Chancellor of the Exchequer Jeremy Hunt, has announced an increase to a windfall tax on oil and gas companies, and also extended it to power generation firms
The measures were among a series of tax increases and public spending cuts announced by Hunt in parliament
Soaring oil and gas prices caused by Russia's invasion of Ukraine have increased household energy bills and triggered the worst cost of living crisis in the UK for generations

LONDON: In a bid to raise tens of billions of pounds to fill a major shortfall in public finances, the UK's finance minister, Chancellor of the Exchequer Jeremy Hunt, has announced an increase to a windfall tax on oil and gas companies, and also extended it to power generation firms.

The measures were among a series of tax increases and public spending cuts announced by Hunt in parliament.

Soaring oil and gas prices caused by Russia's invasion of Ukraine have increased household energy bills and triggered the worst cost of living crisis in the UK for generations.

According to Hunt, oil and gas companies would pay 35 percent more than the current rate of 25 percent, which will be extended until the end of March 2028, bringing the total tax on the sector to 75 percent.

The windfall tax will be expanded to electricity generators the government deems "extraordinary," including low carbon power generators such as wind and nuclear, with a levy of 45 percent being applied from 1st January.

Known as the Energy Profits Levy, the higher windfall tax on oil and gas producers that will take effect on 1st January is expected to raise 40 billion pounds over the next six years.

However, industry body Offshore Energy UK said the windfall tax will "threaten to drive out investors, drive up oil and gas imports and leave consumers increasingly exposed to global shortages."

At the same time, the UK government said that it will reduce its investment allowance plan for spending on new oil and gas extraction to 29 percent of all investment expenditures.

Watch latest videos

News RELEASES

Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Birmingham News.

More Information

17 ℃

Fair in Birmingham

International

Section

After warnings from EU, ChatGPT said it could leave Europe

SAN FRANCISCO, California: Sam Altman, CEO of ChatGPT-maker OpenAI, has said the company could consider leaving Europe if it could ...

Second Biden nominee for federal judge withdraws before hearings

WASHINGTON D.C.: Reuters has reported that US President Joe Biden's nominee for a federal judge position in Kansas, Jabari Wamble, ...

US seeks answers after six near misses at airports

WASHINGTON D.C.: Jennifer Homendy, head of the US National Transportation Safety Board, has said the US will investigate recent near ...

Florida sued for law saying some foreigners cannot purchase land

MIAMI, Florida: Four Chinese citizens living in Florida have sued the state over a new law barring citizens of China ...

Ukrainian pilots to be trained by Norway to operate F-16 fighter jets

OSLO, Norway: Norwegian Defense Minister Bjoern Arild Gram has said that Norway would conduct training programs for Ukrainian pilots in ...

California says it wants to end gas vehicle sales by 2035

LOS ANGELES, California: Reuters has reported that California is seeking approval from the the Biden administration to require all new ...

United Kingdom

Section