Britain: YPOIK defends position in favor of taxation of profits of energy companies

UK Treasury Secretary Richie Sunak has defended the proposal for an emergency tax on the oil and gas companies’ unexpected profits, despite protests from industry executives at their first meeting since the announcement, according to Bloomberg.

Sunak, who said last month he would impose a 25% tax, said the tax would be temporary and a key way to support British households facing a rising cost of living, the ministry said in a statement. Finance.

The discussion with about 20 heads of oil and gas companies, which took place in Aberdeen, Scotland today, was “honest and constructive”, according to Offshore Energies UK. However, energy companies have reiterated that the tax will hurt investor confidence in the country.

“The contribution to energy profits is an unexpected new tax that is changing the basis for investment,” OEUK CEO Deirdre Michie said in a statement after the meeting. “Our industry leaders have been clear about their concerns.”

Profits in the fossil fuel industry have soared this year due to a recovery in demand and a spike in energy prices due to a supply disruption caused by Russia’s invasion of Ukraine. These huge gains come at a time when the UK is facing decades of higher inflation and rising utility bills.

The meeting was attended by representatives of the major oil companies BP, Shell, TotalEnergies and Equinor ASA, as well as independent producers such as Harbor Energy, Neptune Energy Group and Serica Energy, according to people familiar with the matter.

The talks take place just five days before the end of the public consultation on the proposed tax.