Budget Special
Oil firms warn jobs will go after tax hike
Tens of thousands of jobs in the UK will go as a result of a windfall tax on North Sea oil producers announced in the Budget, the industry has warned. Mike Tholen, economics director of Oil and Gas UK, said the change would also damage long-term energy security. The £2bn tax will fund a fuel duty cut, after a surge in global oil prices. Chancellor George Osborne said he would watch fuel prices "like a hawk" to make sure the oil tax was not passed on to drivers. He said it was "economically smart" to redistribute the money from the oil companies as they saw profits rise as a result of soaring oil prices "into the hands of families". The surprise move was announced by Mr Osborne in his second Budget on Wednesday. He increased the supplementary charge on oil and gas production to raise an extra £2bn ($3.3bn) - but said if oil prices fell, the "fuel duty escalator" - which increased fuel tax above inflation - would be reintroduced and the new oil tax would fall.
Source: BBC
Budget fuel move 'to costs North Sea industry £2bn'
A new "fair fuel stabiliser" is expected to cost North Sea oil producers about £2bn. Chancellor George Osborne is raising taxes on oil production to pay for a reduction in petrol and diesel costs for motorists. He said the move would tackle the high cost of living and oil, as he announced his budget in the Commons. However, industry body Oil and Gas UK, said it would have a damaging effect on investment and jobs. Mr Osborne announced in the Budget a 1p per litre cut in fuel duty in response to a recent surge in global oil prices, effective from 1800 GMT. He also said he would cancel a fuel duty escalator, while an inflation-linked rise in the fuel duty planned for next week was delayed until next year.
Source: BBC
Budget proposes 32% corporate tax rate
Leaders of Britain's oil and gas industry were considering the implications of a proposed rise in the supplementary rate of corporate tax for the UK offshore sector from 20 to 32% today. Chancellor George Osborne has just announced the move in the House of Commons as part of his Budget speech at lunchtime today which will have a big impact on investment spending in the UK North Sea and elsewhere on the UK Continental Shelf. The Chancellor said the measure will raise an extra £2 Bn from the UK's offshore industry, but promised it will be reduced if the oil price drops back to less than US $75/bbl.
Source: Offshore247