2016 Budget Gives Boost for North Sea with Tax Cut and Scrapped
Chancellor George Osborne today bowed to pressure from the UK’s embattled North Sea oil industry, delivering tax breaks to help oil companies there weather the rout.
Chancellor George Osborne today bowed to pressure from the UK’s embattled North Sea oil industry, delivering tax breaks to help oil companies there weather the rout.
Nevertheless, the impact is likely to be muted, given North Sea tax receipts are currently close to zero.
Osborne said he will be halving the supplementary charge on oil and gas from 20 per cent to 10 per cent, and scrapping the petroleum petrol tax. Both will be backdatet to 1st of Jan 2016.
“In my budget a year ago I made more reductions to their taxes but the oil price has continued to fall so we need to act,” he said.
Oil prices have fallen from over $100 per barrel in the middle of 2014, and are languishing at around $39 per barrel today.
This has forced North Sea oil companies to cut costs, halt or abandon projects and axe tens of thousands of jobs amid tumbling oil prices.
Scotland, industry body Oil & Gas UK and North Sea oil baron Algy Cluff had all called on the chancellor to address the industry’s urgent predicament in the run up to today’s Budget.
