UK Government Outlines New 25% Tax on Oil-And-Gas Companies
26 Mai 2022 - 2:22PM
Dow Jones News
By Jaime Llinares Taboada
U.K. Treasury Chief on Thursday outlined a new 25% tax on the
profits of oil-and-gas companies.
Rishi Sunak told the House of Commons that this is a temporary
levy which will raise around 5 billion pounds ($6.29 billion) over
the next year, and will be used to fund subsidies for
households.
The tax will be phased out when oil and gas prices return to
historically normal levels, Mr. Sunak said.
In addition, the Chancellor said the government is raising
investment allowances so that, for every pound invested, companies
get back a 90% tax relief.
Earlier this week, oil-and-gas industry lobby Offshore Energies
UK said that a one-off windfall tax wouldn't sustainably help
consumers and would reduce investor confidence in the U.K.
As the global economy recovered from the coronavirus pandemic,
prices for energy commodities have soared in the U.K. and
elsewhere. This was later exacerbated by the war in Ukraine. A
barrel of oil in Europe today costs $114, up from $69 one year ago
and $36 two years earlier.
The increase in the natural gas price has been even higher, and
this commodity is directly correlated with the wholesale
electricity market. This week the British regulator warned that the
annual price cap for energy bills would rise to around GBP2,800 in
October. This compares with GBP1,277 last winter and GBP1,042 in
the same 2020-21 period.
Stronger energy prices have been boosting earnings for
oil-and-gas companies since last year. Shell PLC reported an
adjusted profit of $19.3 billion in 2021 and BP PLC made $12.8
billion, with both figures being the highest since 2018. Analysts
are forecasting that their profits will rise further this year.
Write to Jaime Llinares Taboada at jaime.llinares@wsj.com;
@JaimeLlinaresT
(END) Dow Jones Newswires
May 26, 2022 08:07 ET (12:07 GMT)
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