Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Business

Windfall tax revenue set to slump 40 per cent thanks to falling oil and gas prices

by June 27, 2023
June 27, 2023
Windfall tax revenue set to slump 40 per cent thanks to falling oil and gas prices

The sharp fall in the price of oil and gas will lead to a huge drop in revenue from the government’s windfall tax.

Announced in November of last year, the energy profits levy hiked an existing tax on oil and gas profits and extended its deadline until 2028. Chancellor Jeremy Hunt estimated that it would raise as much as £41.6bn.

However, according to the Treasury’s most recent forecasts from March, the estimated tax take has fallen almost 40 per cent to £26bn.
This reflects the steep decline in oil and gas prices, which in turn has dented the revenue of producers. Wholesale gas prices are almost 90 per cent lower than March of last year while oil prices have fallen to $75 a barrel from $130.

Although the government is expecting to receive less revenue from the levy, the loss is offset by an estimated £22bn fall in the cost of energy support schemes.

The Office for Budgetary Responsibility suggests the two schemes are expected to cost £34.2bn against an initial estimate of £56bn.

Under proposals announced earlier this month, Hunt introduced a price floor – $71.40 per barrel and 54p per therm – at which the windfall tax falls away.

The price floor only kicks in when prices fall below a threshold for at least six months.

The government’s own estimates suggest this won’t happen until March 2028, when the levy was scheduled to end in any case.

Speaking on the BBC this morning, Gilad Myerson, executive chair of Ithaca Energy, said the chances of such a drop were “extremely low” after changes in demand following Russia’s invasion of Ukraine.

“The taxation regime is changing constantly and it’s very difficult to invest huge amounts of capital when you don’t know what type of return you’ll be getting.”

He said Ithaca, which has stakes in six of the largest North Sea fields, was looking at investments in Europe and the US

Read more:
Windfall tax revenue set to slump 40 per cent thanks to falling oil and gas prices

0
FacebookTwitterGoogle +Pinterest
previous post
Supermarkets questioned by MP’s to explain explain high prices
next post
How To Choose The Right Lone Worker Protection Solution For Your Business

You may also like

The Halving Effect: Dissecting Bitcoin’s Supply Shock Phenomenon

April 15, 2024

The Main Goal in Web Development: Deliver Business...

December 14, 2023

Fears grow as Harland & Wolff nears administration,...

September 16, 2024

Talks to avert new train strikes close to...

March 6, 2023

Warm Weather Boosts UK Economy in June

August 11, 2023

Thousands across England and Wales join £2bn claim...

October 24, 2023

Falling Behind? Signs Your Business Needs A Fresh...

June 4, 2025

UK economy to avoid recession this year as...

November 10, 2023

Should I trade mark my business name or...

June 19, 2025

Miliband refuses to reveal his personal view on...

February 7, 2025

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Why More Businesses Are Choosing a Fractional CMO Instead of Agencies and Junior Hires

      July 19, 2025
    • ‘Get a job’: Medicaid work requirements included in Trump’s megabill sparks partisan debate on Capitol Hill

      July 19, 2025
    • Trump has now been in office for six months, for the second time. Here are the highlights

      July 19, 2025
    • Week Ahead: NIFTY Violates Short-Term Supports; Stays Tentative Devoid Of Any Major Triggers

      July 19, 2025
    • Slovenia approves law to legalize assisted dying for terminally-ill adults

      July 19, 2025
    • Heritage Foundation founder Edwin J. Feulner dies at 83

      July 19, 2025

    Categories

    • Business (8,525)
    • Investing (2,134)
    • Politics (16,122)
    • Stocks (3,221)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved