The UK is going to impose a temporary levy on oil and gas producers to ease the pain of rising energy prices for consumers. The British government announced this on Thursday.
There will be a temporary windfall tax of 25 per cent, the proceeds of which will be used for a £ 15 billion support package to help Brits with rising energy bills, including through one-off fees.
The tax, which is directly in effect on top of current taxes, disappears again as oil and gas prices fall. The measure, which affects oil giants such as Shell and BP, may run until the end of 2025.
Finance Minister Rishi Sunak stated on Thursday that oil and gas companies are making “extraordinary profits” and that the levy is expected to bring in £ 5 billion over the next year.
Analysts at Citigroup calculated that BP makes less than 10 percent of its global profits in the UK. For Shell, this would be around 4 percent.