Britain Expected to Extend Windfall Levy on Energy Firms to 2029

Britain is expected to extend a windfall levy on the profits of energy firms by one year to 2029 in this week's budget according to Reuters sources.

• The energy profit levy was introduced in May 2022 in response to soaring energy prices.
• In November 2022 the tax was raised from an initial 25% rate to 35% to take the overall tax burden on North Sea oil and gas producers to 75%.
• The tax rate is expected to remain unchanged. A 29% investment allowance in the windfall tax that allows companies to offset spending will also remain in place.
• North Sea producers have previously warned that UK oil and gas production could collapse in the future if not enough investment in the sector is made because of windfall taxes.
• In June 2023 the UK government announced the 75% windfall tax on oil and gas companies could fall to 40%, if prices would return to normal levels of $71.40/bbl of oil and 0.54p/th for gas for two consecutive quarters.