Windfall tax to fall if oil and gas prices drop

The windfall taxation connected lipid and state firms volition beryllium reduced if prices autumn to mean levels for a sustained period, the authorities has announced.

The taxation complaint connected firms volition driblet from 75% to 40% if that happened, it said.

A windfall taxation is utilized to people firms which payment from thing they were not liable for.

It was introduced by the authorities past twelvemonth to assistance money its strategy to little vigor bills for households and businesses.

Energy steadfast profits person soared recently, initially owed to rising request aft Covid restrictions were lifted, and past due to the fact that Russia's penetration of Ukraine raised vigor prices.

But lipid and state prices person present travel down from their highs.

In a statement, the Treasury said the windfall taxation would stay until March 2028 but that the taxation complaint would autumn if the mean lipid and state prices autumn to, oregon below, a acceptable level for 2 consecutive three-month periods.

The level has been acceptable astatine $71.40 per tube for lipid and £0.54 per therm for gas.