As energy bills spiral for working people, the Labour Party will
on Tuesday give Conservative MPs another opportunity to back a
one-off windfall tax on the oil and gas producers making record
profits from the energy crisis.
In an amendment to the Queen’s Speech debate on the cost of
living, Labour will propose a one-off windfall tax to help fund
greater support for families struggling with the highest rise in
energy bills since the 1970s.
This comes amidst growing pressure on the Conservative Government
for their failure to implement a windfall tax, as oil and gas
giants continue to register record profits. The Government’s
position on the windfall tax has fallen into disarray, with
Cabinet ministers taking a number of different positions all
within the course of one week.
New analysis by the Labour Party today shows the expected
profits of North Sea oil and gas firms in 2022/23 are higher
than the combined rise in energy bills for every household in the
UK.
BP and Shell alone have made £12.37bn of profit in the first
three months of 2022- despite Cabinet Ministers describing these
companies as “struggling” when defending the Conservatives’
refusal to implement a windfall tax.
There is widespread public support for a windfall tax, including
senior business figures such as the Chairs of Tesco’s and John
Lewis.
The Labour Party is proposing that a windfall tax would help fund
their package to reduce the expected energy price rise in April.
Crucially, the Party said it would also target extra support to
squeezed middle, pensioners and the lowest earners, receiving up
to £600 off bills and preventing all of the increase in energy
bills currently expected.
MP, Labour’s Shadow Secretary of State of Climate
Change and Net Zero, said:
“As energy bills rise by record amounts for millions of
families, it is shameful that and are refusing to back a
windfall tax that could tackle the cost of living crisis.
“On Tuesday, Labour will give the Government another chance to
support our windfall tax. It tells you everything you need to
know about this Government that they continue to prioritise the
oil and gas companies making record profits instead of standing
up for working families, and pensioners.
“Britain needs a Government that is on working people’s side.
Only Labour can tackle the cost of living crisis and deliver the
stronger economy we need.”
Ends
Notes for editors:
- The March 2022 Office for Budget Responsibility Economic and
Fiscal Outlook found that North Sea oil and gas tax receipts
would be £3.1bn in 2021/22 and are forecast to reach £7.8bn in
2022/23 (table 3.4).
- These receipts are derived from Corporation Tax on North Sea
Oil and Gas Profits, which is charged at 40% (30% Ring Fence
Corporation Tax and 10% Supplementary Charge).
- This implies that North Sea oil and gas production profits
were £7.75bn in 2021/22, and £19.5bn in 2022/23, an increase of
£11.75bn.
-
https://obr.uk/docs/dlm_uploads/CCS0222366764-001_OBR-EFO-March-2022_Web-Accessible-2.pdf
- The Energy Price Cap rose by £693 in April
2022. https://www.ofgem.gov.uk/publications/price-cap-increase-ps693-april
- There are 27.8 million households in the UK, implying that a
baseline for the total annual increase in energy bills is
£19.27bn.
- Therefore the total value of expected NS oil and gas profits
in 2022/23 is forecast to be greater than the total the increase
in energy bills for all UK households combined.
