Oil and gas profits windfall tax extended until 2029

The 35% surcharge on profits due to high energy prices had been scheduled to end in March 2028. Scottish Conservative leader Douglas Ross said he would not support the legislation needed to pass the extension. The Energy Profits Levy (EPL) was introduced by Rishi Sunak when he was chancellor in May 2022. Energy Profits Levy extended to 2029, raising £1.

5bn for oil and gas firms. Jeremy Hunt said increase in energy prices caused by Ukraine war is expected to last longer, so too will the sector’s windfall profits. Mr Ross said he supported many “positive measures ’ in the budget, such as the 2p cut in national insurance. Mr Ross said he had lobbied both the chancellor and the prime minister on the issue.

He told BBC Scotland News: “I’m not going to hide my disappointment in the fact I urged the chancellor not to extend the windfall levy but that decision was taken. The Scottish Conservatives will now worry that this could dampen enthusiasm for the party in a key target region. Douglas Ross had made clear publicly that he’d been lobbying the chancellor on this very issue. He went public with his pleas.

And on top of that, what does this say about their leader and his ability to influence top levels of the UK party? Scottish Conservatives warn of the economic harms of extending the windfall tax. They fell on deaf ears after a motion at Holyrood warned of the risks. Offshore Energies UK (OEUK) said the extension risked investment, jobs and growth.

The Scottish Conservatives plan to make clear they disagree with this particular budget measure. OEUK chief executive David Whitehouse said industry is being taxed on windfall profits which no longer exist. Scottish Secretary Alister Jack dismissed the concerns, saying he did not believe extending the levy for another year would have any impact on jobs. OEUK said it was impossible to plan investment for the energy transition and the path to net zero.

Aberdeen amp; Grampian Chamber of Commerce also criticised the extension. MP Andrew Bowie, the Conservative MP for West Aberdeenshire and Kincardine, said he agreed with Douglas Ross that the extension was “deeply disappointing. Without investment in new North Sea oil and gas fields, production could halve by 2030. Labour has proposed increasing it to 38%, taking the overall tax rate to 78%.

SNP wants it maintained at the current level. Treasury has promised to scrap the tax if prices fall to normal levels for a sustained period, which would see the tax rate on energy firms fall to 40%.

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