HMRC are seeking views on the design and objectives of a new mechanism to replace the Energy Profits Levy (EPL) after it ends on 31 March 2030 (or sooner if the energy security investment mechanism is triggered). The Government says that the intention is to implement a replacement mechanism that gives investors certainty around how the fiscal regime will respond to future oil and gas price shocks balanced against the requirement for the sector to ‘make an additional contribution to public finances’ when prices are unusually high.
Chapter 4 of the consultation document sets out two policy options:
revenue-based model: targeting ‘the excess revenue a company receives for its oil and gas sold above threshold prices’; and
profit-based model: that would target ‘a proportion of profits deemed to arise from unusually high prices by reference to “average market prices” and the thresholds’.
The consultation notes the Government’s current preference...
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HMRC are seeking views on the design and objectives of a new mechanism to replace the Energy Profits Levy (EPL) after it ends on 31 March 2030 (or sooner if the energy security investment mechanism is triggered). The Government says that the intention is to implement a replacement mechanism that gives investors certainty around how the fiscal regime will respond to future oil and gas price shocks balanced against the requirement for the sector to ‘make an additional contribution to public finances’ when prices are unusually high.
Chapter 4 of the consultation document sets out two policy options:
revenue-based model: targeting ‘the excess revenue a company receives for its oil and gas sold above threshold prices’; and
profit-based model: that would target ‘a proportion of profits deemed to arise from unusually high prices by reference to “average market prices” and the thresholds’.
The consultation notes the Government’s current preference...
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