Source · Select Committees · Environmental Audit Committee
Recommendation 42
42
Acknowledged
Paragraph: 245
Oil and gas companies have understandably complained of the impact on the certainty of their...
Conclusion
Oil and gas companies have understandably complained of the impact on the certainty of their revenue projections arising from sudden changes in the fiscal regime applying to their operations. But these are exceptional times. It would be politically and morally unacceptable for oil and gas companies to pocket record profits because of a war at a time when an unprecedented number of households in the country have been plunged into fuel poverty. The Government was therefore right to introduce its Energy Profits Levy, which is contributing towards the support the Treasury is offering billpayers.
Government Response Summary
The government introduced and increased the Energy Profits Levy (EPL) to address exceptional profits being made by oil and gas companies, and recognizes the impact on the oil and gas industry while believing it is necessary to ensure they pay their fair share of tax.
Paragraph Reference:
245
Government Response
Acknowledged
HM Government
Acknowledged
The Government introduced the Energy Profits Levy (EPL) in May 2022, to address the exceptional profits being made by oil and gas companies as a result of high global energy prices. In the Autumn Statement 2022, the Chancellor announced an increase to the rate of the EPL from 25% to 35%, and extended its duration until March 2028. These changes will bring the overall tax rate for oil and gas companies to 75%, in line with the international average. The Government recognises that the EPL has an impact on the oil and gas industry, but we believe that it is necessary to ensure that these companies pay their fair share of tax on their profits. The EPL will help to fund vital public services, such as schools and hospitals, and will also help to support households with their energy bills.