WHILE there is an overwhelming case for a windfall tax on the obscene profits made by oil and gas companies like Shell and BP, it is merely a sticking plaster over the disastrous UK Government decision to slash taxes on oil and gas production in 2015.
Norway kept taxation on oil and gas at 78% and during the two years of record low prices, Shell paid £4.589bn to Norway while in the UK, the company was awarded £179m in tax rebates.
High taxation didn’t stop investment in the Norwegian half of the North Sea and in 2021 Norway earned almost £25 billion from oil and gas taxes whereas the latest GERS report attributed a notional deficit of £250 million as Scotland’s share of UK petroleum tax. With Brent Crude at $90 and record gas prices, Norway will earn much more this year.
Tuesday’s Channel Four News programme pointed out that in 2019, for each barrel of oil the UK received $1.72 in tax while Norway received to $21.35 In 2017 for each barrel of oil the UK received $1.86 in tax while Norway received $13.53.
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Shell paid $1.8 billion in tax to Norway in 2020 but received £99.1 million in tax back in from the UK gov. The UK was the only country where Shell operates where it didn’t pay tax, according to the company’s annual report on payments to governments. In 2019, BP paid no tax on its UK North Sea oil and gas business. BP’s effective corporation tax rate…
