Sunak pressed to impose energy windfall tax

Rishi Sonak has stepped up his warnings to the UK oil and gas industry that if companies do not announce increased investment plans for the UK “soon” they will face a potential tax on their profits.

The British Chancellor is under pressure from his political rivals – and some prominent members of his Conservative party – to impose a one-off levy on energy groups, which have seen profits skyrocket thanks to the higher price of gas.

On Tuesday the work used a discussion on The Queen’s Last Speech To force a public vote on whether to impose an excessive tax – an opposition move designed to highlight the government’s unwillingness to impose a tax. The vote was lost by 310 to 248.

Although the proposal was not supported by a single Tory MP, there is unrest in the conservative benches that the government has not convinced the public it is doing enough to deal with The cost of living crisis. According to a new YouGov poll, about 72% of Britons think the government treats the economy poorly.

For months, Sonck has opposed the idea of ​​an excessive tax, arguing that it could deter investment in the North Sea while the government wants to improve Britain’s energy security. However, in recent weeks, as companies have shattered analysts’ earnings forecasts, the Chancellor Moved his language.

He has now made it clear that if companies like BP and Shell do not raise their investment targets for the UK beyond existing plans, it will hurt them with the levy. The funds raised can be used to alleviate the growing cost of living crisis.

Ed Miliband, Labor’s shadow shadow secretary, told the House of Representatives that Sonek’s opposition to the levy did not make sense given the fact that previous serial governments had imposed excessive taxes. Margaret Thatcher’s conservative administration raised taxes on the oil and gas sector in the 1980s, hitting banks with an excessive levy in 1981.

“No matter how big the crisis, the greater the welfare, the taxation should not change?” Asked Miliband.

He also quoted some prominent figures who supported the idea. They included Lord Haig, the former leader of the Conservatives, Lord Brown, BP CEO once and John Allen, Tesco CEO.

“The ordinary leftist is suspicious,” Miliband joked.

Sonak told MPs he would take a “pragmatic” approach to the issue. “What we want to see is energy companies Who made extraordinary profits In a period of sharp price rises, invests these profits back in British jobs. “Growth and energy security,” the chancellor said.

“But as I was clear, and as I have said over and over again, if it does not happen soon and on a significant scale, then no option is off the table.”

BP’s investment guarantee fails to suppress UK tax calls

The chancellor said it was “irresponsible” to suggest he did not take action to help people with rising cost of living, as inflation soared.

He told MPs that the government had cut the fuel tax, given the council’s property tax rebate to millions, lowered the universal credit reduction rate and increased the rebate on warm homes. “This government has always worked to protect this country in times of challenge,” Sonak said.

But he added that the reasons for the price increase were essentially global and that “no honest chancellor” could tell the public that they would not go up again. “There is no measure that a government can take, any law you can pass, that can make these global forces disappear overnight.”

Household energy bills in the UK are expected to remain high, despite Ofgem regulator proposals to do so Review the country’s energy price ceiling Every three months, so that any decline in wholesale prices can pass to consumers faster.

Energy consulting firm Cornwall Insight said on Tuesday that it expects the price ceiling to rise by more than £ 600 when it changes next October, to more than £ 2,600 a year per household on average.

Mel Stride, chairman of the Treasury Department’s select committee, said Monday he believes there is a “case” for excessive taxation.

Robert Halfon, chairman of the Education Committee, said he would abstain on Tuesday. He said the government should consider an advanced tax, arguing that oil companies “do not pass the [fuel duty] Cuts for pumps, [and] It takes them ages to reduce the price when the international cost goes down. ”

Meanwhile, Kawasi Quartang, the business secretary, wrote to the fuel retailer urging them to pass the latest 5p cut per liter in the fuel tax to customers as soon as possible.

Quartang said in his letter that the government had asked the Competition and Markets Authority, the regulator, to make sure the industry did not “violate competition or consumer laws”.

Following the public vote, Jenny Stanning from Offshore Energies UK said the Treasury is expected to take £ 5bn more from oil and gas companies than expected last October, due to the high global price and high tax rate.

“Overseas oil and gas companies are already 40% committed, double that of other UK industries,” she said.

“Excessive tax risks harming investments, which will lead to less energy in domestic production, a decrease in investment in green energies and great damage to jobs.”

Another report by Natalie Thomas

Sunak pressed to impose energy windfall tax Source link Sunak pressed to impose energy windfall tax

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